HONG KONG, China—West Texas Intermediate crude surged more than six percent Monday and Brent jumped more than five percent as traders grow increasingly worried about an energy crisis after Western nations imposed fresh sanctions on Russia over its invasion of Ukraine.
WTI rose 6.27 percent to $97.33, while Brent crude was up 5.24 percent at $103.06.
The United States and European Union said they would exclude some Russian banks from the international SWIFT payments system and personally targeted President Vladimir Putin and Foreign Minister Sergei Lavrov.
They also banned all transactions with Russia’s central bank, sending the ruble crashing with Bloomberg saying it was nearly 30 percent down in offshore trading Monday.
“Removing some Russian banks from SWIFT could result in a disruption of oil supplies as buyers and sellers try to figure out how to navigate the new rules,” Andy Lipow, of Lipow Oil Associates in Houston, Texas, noted.
Traders will be closely watching a meeting this week of OPEC and other major producers led by Russia, where they will discuss plans for further output.
The group has agreed previously to increase production gradually each month, but the Ukraine crisis could throw those plans into disarray.
Russia’s ruble, meanwhile, plunged nearly 30 percent against the dollar Monday after world powers imposed fresh, harsher sanctions on Moscow over its invasion of Ukraine.
The ruble was indicated to be down 27 percent at 114.33 per dollar in offshore trading, according to Bloomberg News.
The United States and European Union said they would exclude some Russian banks from the international bank payments system SWIFT and personally targeted Russian President Vladimir Putin and Foreign Minister Sergei Lavrov. They also banned all transactions with Russia’s central bank. AFP
Meanwhile, the G7 nations—Canada, France, Germany, Italy, Japan, Britain and the United States—warned they would “take further steps” to add to the sanctions already announced if Russia did not cease its operation.