
Russia’s announcement of an oil export ban on countries that abide by a G-7 price cap is the latest sign that we’ve entered a new era for global energy markets, according to analysts.
But they also note it’s unlikely to have a short-term impact on oil prices, with markets taking their cues from data and concrete actions rather than words.
The price cap was introduced on Dec. 5 and requires traders using Western services such as maritime routes, insurance and financing to pay no more than $60 per barrel for seaborne Russian oil. Urals crude is currently trading around $50 per barrel, according to Finnish refining firm Neste.
Russia on Wednesday said that from Feb. 1 it would stop crude oil and oil products for five months to any nation that adhered to the cap, with a separate ban on refined oil products to come.
Dan Yergin, vice chairman of S&P Global, told CNBC’s “Squawk Box” Tuesday that despite skepticism over whether the program would work, leaders had found a way to keep oil flowing into the market while reducing Russian oil revenues.
But as a result, he said, we now have a “divided, more politically charged oil market.”
“For the last 30 years, since the collapse of the Soviet Union, we’ve had a global market in which oil has pretty much moved around based on the economics, exceptions were Iran and Venezuela.”
This report’s information was first seen on CNBC; to read more, click this link.
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