IPA Newspack
  • Home
  • now
  • politics
  • business
  • markets

IPA /

Markets

Markets

Oil price surges to highest since 2008

 

Oil prices soared to their highest since 2008 due to delays in the potential return of Iranian crude to global markets and as the United States and European allies consider banning imports of Russian oil.

Talks to revive Iran’s 2015 nuclear deal with world powers were mired in uncertainty on Sunday following Russia’s demands for a U.S. guarantee that the sanctions it faces over the Ukraine conflict will not hurt its trade with Tehran. China has also raised new demands, according to sources.

In response to Russia’s demands, U.S. Secretary of State Antony Blinken said on Sunday that the sanctions imposed on Russia over its Ukraine invasion have nothing to do with a potential nuclear deal with Iran.

The United States and European allies, meanwhile, are exploring banning imports of Russian oil, Blinken said on Sunday, and the White House coordinated with key Congressional committees moving forward with their own ban.

Brent rose $11.67, or 9.9%, to $129.78 a barrel by 6:50 p.m. EST (2350 GMT), while U.S. West Texas Intermediate (WTI) crude rose $10.83, or 9.4%, to $126.51, putting both contracts on track for their highest daily percentage gains since May 2020.

In the first few minutes of trade on Sunday, both benchmarks rose to their highest since July 2008 with Brent at $139.13 a barrel and WTI at $130.50. Both contracts hit their highest in July 2008 with Brent at $147.50 a barrel and WTI at $147.27.

U.S. gasoline and distillate futures followed the surge in crude prices in the first few minutes after the market opened on Sunday, rising to record highs.

“Iran was the only real bearish factor hanging over the market but if now the Iranian deal gets delayed, we could get to tank bottoms a lot quicker especially if Russian barrels remain off the market for long,” said Amrita Sen, co-founder of Energy Aspects, a think tank.

Analysts from JP Morgan said this week oil could soar to $185 per barrel this year.

“The idea was not to sanction oil and gas because of their essential nature, but oil is getting sanctioned by private actors not wanting to pick it up or ports not wanting to receive it and the longer this goes on the more supply chains are going to buckle,” said Daniel Yergin, author and vice chairman of S&P Global ahead of the CERAWeek conference in Houston.

Russia exports around 7 million bpd of oil and refined products or 7% of global supply. Some volumes of Kazakhstan’s oil exports from Russian ports have also faced complications.

Analysts at Bank of America said if most of Russia’s oil exports are cut off, there could be a 5 million barrel or larger shortfall, and that means oil prices could double from $100 to $200 a barrel.

Iran will take several months to restore oil flows even if it reaches a nuclear deal, analysts said.

Eurasia Group said fresh Russian demands could disrupt nuclear talks although it still kept the odds of a deal at 70%.

“Russia may intend to use Iran as a route to bypass Western sanctions. A written guarantee allowing Russia to do so is probably well beyond the realm of what Washington can offer in the midst of a full-scale war in Ukraine,” said Eurasia’s Henry Rome.

Also supporting crude prices, the closure of Libya’s El Feel and Sharara oilfields resulted in the loss of 330,000 barrels per day (bpd), the National Oil Corporation (NOC) said on Sunday. Libya, an OPEC member, produced about 1.2 million bpd of crude in 2021, according to U.S. energy data.

In the United States, meanwhile, the average price of a gallon of gasoline hit $4.009 on Sunday, according to AAA, an automobile association, which is the highest since late July 2008. Consumers are paying 40 cents more than a week ago, and 57 cents more than a month ago.

AAA, which has data going back to 2000, said U.S. gasoline prices at the pump rose to a record $4.114 on July 17, 2008.

Senior U.S. officials traveled to Venezuela on Saturday for talks with President Nicolas Maduro’s government, seeking to determine whether Caracas is prepared to distance itself from close ally Russia.

via India Infoline

IPA Special

West Unlikely To Stop Fuelling Russia-Ukraine War Soon

February 6, 2023
IPA Special

BJP’s Reverses In Legislative Council Elections In Nagpur Is A Bad Omen For Ruling Alliance

February 6, 2023
IPA Special

Shocks That The Indian Economy Faced Since 2014

February 6, 2023
IPA Special

Nitish Kumar Is A Victim Of Trust Deficit Amongst His Coalition Leaders

February 6, 2023
Happening Now

Parliament adjourned amid Opposition protest on Adani row

February 6, 2023
Politics

Delhi Assembly fails to elect mayor even on third attempt

February 6, 2023
Politics

Another jolt to Bengal BJP as MLA joins Trinamool

February 6, 2023
Politics

Mann govt faces heat over sacrilege case

February 6, 2023
Politics

AAP to contest all seats in MP assembly elections

February 5, 2023
Politics

New turn in UP’s OBC politics as Maurya backs caste census

February 5, 2023
Happening Now

Video shows Chinese balloon being downed by US missile

February 5, 2023
Politics

Assam CM says child marriage crackdown to continue

February 5, 2023
IPA Special

BJY Has Improved Rahul’s Image To The Congress Supporters But That Is Not Enough

February 4, 2023
IPA Special

China Reopening Changing Market Dynamics Impacting Importers

February 4, 2023
IPA Special

Union Budget 2023-24: Kerala Again Cold Shouldered

February 4, 2023
IPA Special

2023-24 Budget Keeps Key Issues Of Indian Workers Unaddressed

February 4, 2023
IPA Special

Modi Baiter Trinamool Spokesperson Saket Gokhale Is In ED Net

February 4, 2023
IPA Special

Israelis And Palestinians Do What They Do Best, But For Wrong Reasons

February 4, 2023
IPA Special

‘Let It Be Morning,’ A Stunningly Powerful Almost All-Palestinian Israeli Film

February 4, 2023
Happening Now

RBI says banking sector stable amid Adani stocks rout

February 4, 2023

An appeal

The legacy of IPA, founded by Nikhil Chakravartty, the doyen of journalism in India, to keep the flag of independent media flying high, is facing the threat of extinction due to the effect of the Covid pandemic. Only an emergency funding can avert such an eventuality. We appeal to all those who believe in the freedom of expression to contribute to this noble cause.
Click here to learn more

Share

Reply

  • 0
More on IPA

India’s import bill for edible oil likely to jump by $2 billion

April 8, 2022 9:34 am | IPA Staff

India’s import bill for edible oils is slated to jump by $2 billion, following the sharp rise in prices after Russian attack on Ukraine. Supply...

Markets

Russia offers India oil at $30-35 a barrel

April 1, 2022 10:54 am | IPA Staff

Sanctions-hit Russia is offering hefty discounts to India for direct oil purchases, which will make it attractive for New Delhi to get into contracts with...

Markets

Govt may dip into strategic oil reserves to calm prices

March 29, 2022 11:49 am | IPA Staff

The government is committed to supporting initiatives for releases from the Strategic Petroleum Reserves for mitigating market volatility and calming the rise in global crude...

Markets

Bulk diesel price rise wrecks state transport corporations

March 22, 2022 10:58 am | IPA Staff

Road transport corporations (RTCs), which are run by state governments, are staring at big losses and an undermining of their operational viability owing to last...

Markets

India’s import bill for edible oil likely to jump by $2 billion

in Markets
Apr 8, 2022   ·  

Russia offers India oil at $30-35 a barrel

in Markets
Apr 1, 2022   ·  

Govt may dip into strategic oil reserves to calm prices

in Markets
Mar 29, 2022   ·  
Follow us on
Up Next: China says ready for Ukraine mediation
©2020 -2021 India Press Agency, All Rights Reserved
Newspack by India Press Agency
logo
  • Home
  • now
  • politics
  • business
  • markets