Oil Surges to 13-Year High of $129 Per Barrel

The price of international benchmark, Brent crude oil traded nine per cent higher to close at $128.60 per barrel on Sunday, the highest price seen since 2008 as the market continued to react to supply disruptions stemming from Russia’s ongoing invasion of Ukraine and the possibility of a ban on Russian oil and natural gas.

Brent had risen to $139.13 at one-point on Sunday before closing at $128.60.

According to CNBC, the price of US crude oil also surged more than eight per cent in early trading on Sunday evening. Precisely, the West Texas Intermediate crude futures, the US oil benchmark, traded eight per cent higher to above $125 a barrel, the highest since July 2008. At one point the price rose to $130.50 Sunday evening before retreating.

“Oil is rising on the prospect for a full embargo of Russian oil and products,” said John Kilduff of Again Capital.
“Already high gasoline prices are going to keep going up in a jarring fashion. Prices in some states will be pushing $5 pretty quickly.”
The US and its allies are considering banning Russian oil and natural gas imports, Secretary of State Antony Blinken said in an interview with CNN’s “State of the Union” on Sunday.

“We are now talking to our European partners and allies to look in a coordinated way at the prospect of banning the import of Russian oil while making sure that there is still an appropriate supply of oil on world markets,” he said. “That’s a very active discussion as we speak.”

While Western sanctions againt Russia have so far allowed the country’s energy trade to continue, most buyers are avoiding Russian products already. Sixty-six percent of Russian oil is struggling to find buyers, according to JPMorgan analysis.

The US average for a gallon of gas topped $4 on Sunday, according to AAA, in a rapid move due to the conflict. The underlying cost of oil accounts for more than 50 per cent of the cost of gas that consumers put in their cars.

Meanwhile, the Group Managing Director of the Nigerian National Company Limited, Mallam Mele Kyari and top management of company yesterday inspected filling stations as part of efforts to ramp up the improving fuel supply situation in Abuja and other parts of the country.

“We are happy normalcy is returning. We are loading products all over the country in all the depots for 24 hours; the truck numbers are increasing and we have seen that the situation in Lagos and Abuja have greatly improved.

“We are here to ensure that our station sells 24-hours so that normalcy would return and Mr. President is constantly kept in the picture of what is happening and he has given us all the support and direction we require, including the Minister of State for Petroleum Resources and we are working closely with the downstream authority and the security agencies and we believe normalcy would return very soon,” he added.

Also, the Executive Director, NMDPRA, Mr. Ogbugo Ukoho, confirmed the increased collaboration from the security agencies and marketers to address the challenge of fuel scarcity.

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