Oil prices jumps up as Ukraine conflict escalates
Asian shares mostly rose Friday after US stocks recovered toward the end of a wild trading day, as governments slapped sanctions on Russia for its invasion of Ukraine.
Oil prices on both sides of the Atlantic briefly jumped above $100 per barrel on Thursday to their highest levels since 2014. But they gave back some of those gains after US President Joe Biden said the sanctions package is “specifically designed to allow energy payments to continue.”
Biden also said he wanted to limit the economic pain for Americans.
The Russian invasion of Ukraine caused a barrage of new financial sanctions Thursday. The sanctions are meant to isolate, punish and impoverish Russia in the long term. Biden announced restrictions on exports to Russia and sanctions against Russian banks and state-controlled companies.
The London Stock Exchange announced it has suspended VTB Capital’s membership following Britain’s sanctions in retaliation for Russia’s invasion of Ukraine.
The suspension means that VTB Capital, owned by one of Russia’s biggest banks VTB, can no longer trade on the LSE, a spokesman for the exchange said.
US and European officials are holding one key financial sanction against Russia in reserve, choosing not to boot Russia off SWIFT, the dominant system for global financial transactions, AP is reporting.
Biden played down the need to block Russia from SWIFT, saying that while it’s “always” still an option, “right now that’s not the position that the rest of Europe wishes to take.” He also suggested the sanctions being put in place would have more teeth.
Crude oil rose back above $100 a barrel on Friday as Russian troops closed in on the Ukrainian capital Kyiv following a day of market volatility.
Brent crude gained 2.1 percent to $101.18 a barrel at 11.43 a.m. Riyadh time after nearing $106 on Thursday before falling back to $99 as US sanctions spared Russian energy exports. US benchmark WTI added 1.7 percent to $94.34 a barrel.
European natural gas prices eased about 19 percent to €109 ($121.90) per megawatt-hour after reaching €142 on Thursday.