Oil and gas prices soar to new records after fourteen years

From the last two weeks the entire world is eagerly watching the development of the Ukraine-Russia conflict and its economic impacts. All of us are aware that the USA and its European allies have tense relations with Russia. The Russia-Ukraine conflict is affecting trade and commerce. Recently, it was seen that the oil prices were also affected by the war. The United States has decided to ban Russian oil imports. The Brent crude futures made a gain of 0.9% or $1.06. It was standing at $124.27 a barrel. Similarly, the US West Texas Intermediate (WTI) crude futures made a gain of 0.3% or 36 cents. It was standing at $119.72 a barrel. Oil prices have jumped to their highest figure in the last fourteen years. The American leadership said that it was planning to request other nations so that Russian oil can be banned.

The experts are claiming that the price movement of oil has been far too aggressive. In a short spell of time, the oil prices have started touching new heights. Germany, one of the largest buyers of Russian crude, does not support the plans of an energy embargo. Senior US officials have also said that no final decisions have been made. Russia exports a large volume of oil and crude products. It is estimated to be 7 million barrels per day.

Several senior commodities analysts have admitted that the heavy sanctions on the Russian banks have affected finance. In case the global markets decide to block the Russian oil exports, the prices are likely to skyrocket. Some are assuming it could touch $200 a barrel, but Russia's deputy Prime Minister asserted that oil could even soar to $300. The OPEC Secretary admitted that no capacity in this entire world can replace the shortage of 7 million barrels. After Saudi Arabia, Russia is the second largest producer of oil. It supplies one-third of all oil required by Europe. The disruption of oil supplies is also seen in the status of inventory. The US crude stockpile was also reduced.

Most investors are confident that the global economy will not get affected despite the crisis. Several governments, senior diplomats and other state leaders are making desperate attempts to bring the situation under control. As the sanctions slapped on Russia are likely to disrupt trade, the European traders were acting cautiously. The US stocks have limited exposure to Russia and hence not much effect was seen. In such turbulent times, the price of gold managed to hit $2,000 an ounce. The experts are closely observing the massive price movement of commodities.

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