An unverified document shows the U.S. will impose its toughest sanctions yet on Russia’s oil sector ……
Oil prices soared on Friday and were on track for a third consecutive week of gains as traders focused on possible supply disruptions caused by more U.S. sanctions against Russia and renewed geopolitical complications in the Middle East.
On Friday’s U.S. session, WTI crude oil surged more than 4% during the day and once approached $77 a barrel; Brent crude oil likewise surged more than 4% and once returned to the $80 mark, reaching its highest level in more than three months.
The U.S. is set to impose its toughest sanctions to date on the Russian oil industry, putting 180 ships, dozens of traders, two major oil companies and some of Russia’s top oil executives on the sanctions list, according to a document seen by foreign media.
The document, purportedly from the U.S. Treasury Department, is being circulated among traders in Europe and Asia, but it’s worth being wary that its authenticity can’t be verified for now.
Ahead of President-elect Donald Trump’s Jan. 20 inauguration, the market expects the Biden administration to tighten sanctions on Russia and Iran at a time when oil inventories remain low.
PVM analyst Tamas Varga said, “This will be a farewell gift from the Biden administration.” He added that existing and possibly further sanctions, as well as market expectations of lower fuel inventories due to cold weather, are pushing up oil prices.
The U.S. Weather Service expects the central and eastern parts of the country to experience below-average temperatures. Many parts of Europe have also suffered from extremely cold weather and may continue to experience a colder than usual start to the year.
Analysts at JPMorgan said in a report on Friday, “We expect global oil demand to surge by 1.6 million barrels per day year-on-year in the first quarter of 2025, driven by …… demand for fuel oil, kerosene and LPG.”
The premium of near-month Brent crude to the six-month contract reached its highest level since August this week, which could indicate tight supply amid rising demand.
Inflation concerns are also pushing up crude prices, said Ole Hansen, head of commodities strategy at Saxo Bank. Investors are worried that Trump’s planned tariffs could push up inflation. By buying crude oil futures is a popular way to trade against rising consumer prices.
In addition, in the geopolitical situation, the situation in the Middle East is once again complicated, Yemen’s Houthi armed forces issued a statement on the 10th, said the organization in the northern Red Sea on the U.S. “Harry Truman” aircraft carrier launched a missile attack, and launched a drone attack on Tel Aviv, Israel. This followed six air strikes on the port of Hodeidah on the western coast of Yemen.
According to Yemeni Houthis, on January 10, local time, the northwestern Yemeni province of Amran was hit by US and British airstrikes, and explosions were heard in the Yemeni capital of Sana’a.
