The US oil price rally has continued into the new week after the Biden administration imposed harsh sanctions on Russian oil exports. WTI crude for February delivery jumped 3.0% to $78.77 per barrel, while Brent crude for March delivery rose 1.8% to $81.18 per barrel. The sanctions target 180 vessels, senior Russian oil executives, and dozens of traders, with two major oil companies – Surgutneftgas and Gazprom Neft – among those affected.
These firms handle 25% of Russia’s oil exports, shipping an average of 970,000 barrels a day in 2024. The sanctions are expected to severely disrupt Russian oil exports to key buyers like India and China, who were previously major consumers of Russian crude. In November, India’s import of Russian oil plummeted 55% year-over-year, with Prime Minister Narendra Modi citing the need to diversify energy supplies.
India has announced that it will abide by the sanctions and turn away sanctioned tankers, following a visit to Guyana where Modi discussed investing in the country as a key energy source. The ongoing Middle East conflict has also compromised India’s energy security, with most of its oil imports coming from the region.
Source: https://oilprice.com/Latest-Energy-News/World-News/Oil-Price-Rally-Continues-After-US-Sanctions-Russias-Biggest-Oil-Sellers.html