Oil prices climb towards $100 as the West rolls out sanctions on Russia
The escalating crisis on Ukraine’s eastern flank saw oil prices inch towards $100 a barrel for the first time in almost a decade yesterday.
The conflict has created fears of supply shortages and market disruption.
Brent Crude peaked yesterday at $99.26 a barrel before settling at around $97 in evening trading.
Russian leader Vladimir Putin has pledged to continue to supply natural gas to world markets, but Bank of America analysts have predicted that oil prices could rise by as much as $20 a barrel if gas supplies are restricted and western countries are forced to find alternative energy supplies.
Oil’s climb towards the $100 figure follows nine consecutive weeks of Brent crude gains, with prices also boosted by rebounding demand as economies finally exit pandemic restrictions.
UK petrol prices, which are heavily affected by the global wholesale price of oil, are already at new highs – putting further upward pressure on the cost of living and squeezing the economic recovery further.
Any further energy price shock would also hit manufacturers hard.
OANDA’s Craig Erlam said: “A nuclear deal between the US and Iran will alleviate some of the pressures in the oil market but as we’re seeing, that’s doing little to stop oil prices marching towards $100.”