January 13, 2025
Unite States of America, USA, sanctions targeted at Russian production and export flows has triggered oil prices increase in the global commodities market.
Report monitored on Marketforces Africa, on Monday, indicated that Brent crude rose by 1.6%, reaching $80.45 per barrel, while the US benchmark West Texas Intermediate (WTI) increased by 1.6%, from $75.79 to $76.98 per barrel.
The surge in the benchmarks are responses to US sanctions on Russian oil producers and exporters, amplifying concerns over global supply, this resulted to oil prices hitting their highest level since October last year.
The US Treasury Department, had on Friday announced a series of comprehensive measures as added sanctions to uphold the G7 commitment to reduce Russia’s energy revenues, including adding Gazprom Neft and Surgutneftegas, two of Russia’s largest oil producers and exporters, along with their affiliates.
The statement also revealed that more than 30 Russian oil field service providers were added to the sanctions list, along with several high-ranking Russian energy officials and executives, including top managers of Russian oil producers.
Report also has that the UK also imposed sanctions on Gazprom Neft and Surgutneftegas. US Secretary of the Treasury Janet Yellen emphasized that these sanctions are aimed at countering Russia’s largest source of revenue, which is used to finance its war against Ukraine.
According to the US Department of State, around 80 entities and individuals active in liquefied natural gas (LNG) production and export activities were also sanctioned under the latest measures against Russia.
However, the Russian Foreign Ministry has vowed to retaliate against the US decision, stating that Washington’s ‘hostile actions’ would not go unanswered.
‘The new sanctions are an attempt to harm the Russian economy and at the same time threaten to destabilize global markets,’ the Russian Foreign Ministry said in a statement, according to reports.
These latest sanctions have the potential to erase the expected surplus for the oil market this year, ING commodities strategists said in a note. “On the surface, these sanctions have the potential to have a significant impact on Russian oil flows. Prior to these sanctions, we were already seeing disruptions to Russian (and Iranian) export volumes.
“The Middle East physical market has been stronger as buyers look for alternative grades. In China, ahead of these recently announced sanctions, Shandong Port Group banned US-sanctioned tankers from calling at its ports.