Russian supply cut may drive oil prices to $200: Bloomberg

The prices of crude options are increasing, with at least 200 contracts traded for the option to buy May Brent at $200 a barrel, according to ICE Futures Europe data.

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RIYADH: Oil could rise to over $200 before the end of March as the risk of a cutoff from Russian supplies looms, Bloomberg reported some traders warn.

The prices of crude options are increasing, with at least 200 contracts traded for the option to buy May Brent at $200 a barrel, according to ICE Futures Europe data.

The June Brent $150 a barrel call option has doubled on Monday, compared to last Friday, ICE reported, adding that the cost of the $180 call options increased by 110 percent.

Last week, the global investment bank JPMorgan Chase & Co stated that continued Russian supply disruption could end the year at $185 a barrel.

Additionally, Australia & New Zealand Banking Group said around 5 million barrels a day of pipeline and seaborne oil are being affected by the newly imposed sanctions. Meanwhile, Oil major Shell has sought to defend its decision to buy a heavily-discounted consignment of oil from Russia, saying it would commit the profits to a fund dedicated to humanitarian aid for Ukraine.

On Friday, Shell purchased 100,000 metric tons of flagship Urals crude from Russia. It was reportedly bought at a record discount, with many firms shunning Russian oil due to Moscow’s unprovoked invasion of its neighbor. The purchase did not violate any Western sanctions.

Shell said in a statement late Saturday that it had been in “intense talks with governments and continue to follow their guidance around this issue of security of supply, and are acutely aware we have to navigate this dilemma with the utmost care.”

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