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Oil soars on tough EU sanctions on Russia

the European Unionthe long-awaited announcement of a strict ban on the energy supply of Russia On Wednesday, flip-flopping traders forgot about demand destruction concerns for the time being and propel oil prices by the highest amount in three weeks.

West Texas Intermediate Rose $5.40 settle at $107.81 per barrel, while Brent settled $5.17 $110.14 per barrel according to the President of the European Commission Ursula von der Leyen declared that “It will be a total ban on the import of all Russian oil, transported by sea and by pipeline, crude and refined”.

She added that supplies of Russian crude will be cut within six months and refined products by the end of 2022; for the record, Russia shipped approx. 720,000 barrels per day (b/d) of crude to European refineries through its main pipeline to the region last year.

Bjarne SchieldropChief Commodity Analyst at Seb, remarked: “Russian oil is now ‘bad oil’; this energy war of “good oil” against “bad oil” has just begun.

Unsurprisingly, European energy prices have also jumped up on Wednesday due to the news, gas, electricity and coal prices jumped more than 4 percent.

Marc Haefeleinvestment director at UBS Global Wealth Managementsaid of Poland and Bulgaria being denied shipments from Russia due to a dispute over payment terms, “our central scenario envisions more disruptions of Russian gas supplies to Europe in the future.

“Some of the targeted countries may experience economic stagnation or slight contractions in the process.”

In addition to energy supplies from the WE exploited by Europe to partly compensate for the loss, gas deliveries Norwaysecond gas supplier in Europe, increased on Wednesday after the end of maintenance work.

Meanwhile in the United States, the Energy Information Administration reported stocks were up 1.2 million barrels like Washington released more barrels from strategic reserves; however, fuel stocks fell in part due to increased product exports following international outrage over Russia’s invasion of Russia. Ukraine.

As for other business influences this week, all eyes are on a Thursday meeting of the Organization of Petroleum Exporting Countries (OPEC) and its allies on output policy, in which the cartel is expected to stick to its policy for another modest monthly increase in output.

This, combined with other factors, could lead to further increases for major crude benchmarks, and Phil Flynnsenior market analyst at Price Futures Group Inc.., mentioned of Europe weaning itself off Russian oil and products, “Stocks are so tight, so in that context, when you talk about this ban, there are a lot of questions about how [Europe] will compensate for that.