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Market News International oil prices rise, EU embargo on Russia may expand supply gap to 2 million barrels per day
International oil prices rise, EU embargo on Russia may expand supply gap to 2 million barrels per day
On Wednesday (June 1), international oil prices rose, as EU leaders agreed to partially and phased forward the ban on Russian oil imports, the market supply gap expanded to 1.5 million to 2 million barrels per day in the second half of this year, and oil prices may exceed $130 per barrel. . But news of a sharp increase in U.S. crude production capped gains in oil prices. U.S. crude oil production rose more than 3% in March, with output in New Mexico rising to nearly 1.5 million bpd, the highest on record.
2022-06-01
8830
International oil prices rose on Wednesday (June 1) as EU leaders agreed to partially and phased forward a ban on Russian oil imports. But news of a sharp increase in U.S. crude production capped gains in oil prices.
At 17:04 GMT+8, NYMEX crude oil futures rose 1.44% to $116.32 a barrel; ICE Brent crude oil futures rose 1.41% to $117.23 a barrel.
European leaders agreed in principle to complete a 90 percent cut in Russian oil imports by the end of this year, in what would be the toughest EU sanctions on Russia since Russia invaded Ukraine. Once the ban is fully passed, the sanctions will be phased in over six months and the refined oil sanctions over eight months. As a concession to landlocked countries in Central Europe such as Hungary, the ban exempts imports of Russian oil through pipelines.
Poland and Germany are pipeline importers of Russian oil but have pledged to stop buying Russian oil by the end of 2022. Landlocked Hungary, Slovakia and the Czech Republic all receive Russian oil from pipelines, temporarily exempt from embargoed import bans. Bulgaria was also exempted at the end of 2024 because its refineries were designed to receive only Russian crude.
Hetal Gandhi, director of CRISIL Research, said: "With Russia not planning to withdraw its troops from Ukraine anytime soon, we do not expect tensions in the region to be resolved until the end of the third quarter, and volatility in oil prices will continue in the coming quarters."
Suvro Sarkar, chief energy analyst at DBS Bank, said: "We think once the details of the EU ban become clearer in the next few days, mainly the timing and extent of the ban, we may see oil prices break above $130 a barrel."
ANZ analyst Soni Kumari said the latest EU ban would certainly worsen the oil supply backdrop and widen the market's supply gap to 1.5 million to 2 million barrels per day in the second half of the year.
According to the monthly report released by the U.S. Energy Information Administration (EIA) on Tuesday, U.S. crude oil production increased by more than 3% in March, reaching the highest level since November last year; New Mexico output rose to nearly 1.5 million barrels per day, a record high; Germany Texas production rose to nearly 5 million barrels a day, the highest level since December. But U.S. crude output remains well below the record high of 12.3 million bpd set in 2019.
At 17:04 GMT+8, NYMEX crude oil futures rose 1.44% to $116.32 a barrel; ICE Brent crude oil futures rose 1.41% to $117.23 a barrel.
European leaders agreed in principle to complete a 90 percent cut in Russian oil imports by the end of this year, in what would be the toughest EU sanctions on Russia since Russia invaded Ukraine. Once the ban is fully passed, the sanctions will be phased in over six months and the refined oil sanctions over eight months. As a concession to landlocked countries in Central Europe such as Hungary, the ban exempts imports of Russian oil through pipelines.
Poland and Germany are pipeline importers of Russian oil but have pledged to stop buying Russian oil by the end of 2022. Landlocked Hungary, Slovakia and the Czech Republic all receive Russian oil from pipelines, temporarily exempt from embargoed import bans. Bulgaria was also exempted at the end of 2024 because its refineries were designed to receive only Russian crude.
Hetal Gandhi, director of CRISIL Research, said: "With Russia not planning to withdraw its troops from Ukraine anytime soon, we do not expect tensions in the region to be resolved until the end of the third quarter, and volatility in oil prices will continue in the coming quarters."
Suvro Sarkar, chief energy analyst at DBS Bank, said: "We think once the details of the EU ban become clearer in the next few days, mainly the timing and extent of the ban, we may see oil prices break above $130 a barrel."
ANZ analyst Soni Kumari said the latest EU ban would certainly worsen the oil supply backdrop and widen the market's supply gap to 1.5 million to 2 million barrels per day in the second half of the year.
According to the monthly report released by the U.S. Energy Information Administration (EIA) on Tuesday, U.S. crude oil production increased by more than 3% in March, reaching the highest level since November last year; New Mexico output rose to nearly 1.5 million barrels per day, a record high; Germany Texas production rose to nearly 5 million barrels a day, the highest level since December. But U.S. crude output remains well below the record high of 12.3 million bpd set in 2019.
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