Oil prices extended their gains for a third session on Monday, with Brent crude rising above $80 a barrel to its highest in more than four months. The increase was driven by wider U.S. sanctions on Russian oil and the expected effects on exports to top buyers India and China.
The sanctions, which were imposed by the U.S. Treasury, target not only Russian oil companies but also 183 vessels that have shipped Russian oil. This move is likely to severely impact Russia’s oil exports, leading to a shortage of crude in global markets. As a result, prices are expected to rise further.
Analysts at Goldman Sachs estimate that the sanctions will transport 1.7 million barrels per day of oil, which accounts for about 25% of Russia’s exports. The bank now expects its projection for Brent prices to skew to the upside.
The OPEC+ cartel has been holding back 5.86 million barrels per day, which could help fill the supply gap caused by the sanctions. However, some analysts warn that the logistical problems posed by the sanctioned vessels could still have a significant impact on global crude flows.
“This is genuine fear in the market about supply disruption,” said PVM analyst Tamas Varga. “But it’s unclear what will happen when Donald Trump takes office next Monday.”
Overall, the Russian sanctions are likely to have a significant impact on global oil prices and supplies. As the situation unfolds, traders and analysts will continue to monitor developments closely.
Source: https://www.cnbc.com/2025/01/13/oil-jumps-on-expectations-new-us-sanctions-to-cut-russian-supply.html