New Nation Report :
Crude oil prices soared to their highest since 2008 amid fears of a supply crunch from Russia’s invasion of Ukraine.
Russia is the world’s second top producer of crude oil after Saudi Arabia, and supplies about a third of Europe’s needs.
On Monday, oil prices jumped to $139 a barrel, the highest level for almost 14 years, while wholesale gas prices for next-day delivery more than doubled.
Bangladesh, which is heavily dependent on oil imports, will now see a surge in import bills, thereby posing a significant headwind for the local currency (taka).
Brent rose $11.67, or 9.9%, to $129.78 a barrel by 6:50 p.m. EST (2350 GMT), while U.S. West Texas Intermediate (WTI) crude rose $10.83, or 9.4%, to $126.51, putting both contracts on track for their highest daily percentage gains since May 2020.
Both contracts hit their highest in July 2008 with Brent at $147.50 a barrel and WTI at $147.27.
U.S. gasoline and distillate futures followed the surge in crude prices in the first few minutes after the market opened on Sunday, rising to record highs.
Analysts from JP Morgan said this week oil could soar to $185 per barrel this year.
“The idea was not to sanction oil and gas because of their essential nature, but oil is getting sanctioned by private actors not wanting to pick it up or ports not wanting to receive it and the longer this goes on the more supply chains are going to buckle,” said Daniel Yergin, author and vice chairman of S&P Global ahead of the
CERAWeek conference in Houston.
Analysts at Bank of America said if most of Russia’s oil exports are cut off, there could be a 5 million barrel or larger shortfall, and that means oil prices could double from $100 to $200 a barrel.
In the United States, meanwhile, the average price of a gallon of gasoline hit $4.009 on Sunday, according to AAA, an automobile association, which is the highest since late July 2008. Consumers are paying 40 cents more than a week ago, and 57 cents more than a month ago.
