The EU could decide next week on an embargo on Russian oil. This embargo project, which needs the unanimity of the 27 Member States to be adopted, is currently still blocked by Hungary, which is very dependent on Russian energy.
(Boursier.com) — Oil prices posted their third straight week of gains for U.S. WTI crude on Friday amid fears of Russian supply disruptions, and as gasoline prices hit all-time highs in the USA.
The barrel of American light crude WTI (June futures), which fell below $100 on Tuesday, jumped 4.1% to $110.49 on the Nymex on Friday, while the Brent North Sea climbed 3.8% to $111.55. Over the week, WTI gained 0.6% and Brent fell 0.7%.
Crude prices were notably supported on Friday by the rise in fuel futures, which broke new records in the United States. Pump prices are also at historic highs, at $4.43 a gallon for gasoline and $5.56 for diesel, according to the AAA Automobile Association.
Decisive week ahead for Russian energy
Black gold prices are torn between two opposing forces, on the one hand a slowdown in demand due to a less dynamic economy, particularly in China, and on the other hand a drop in supply linked to the embargo on Russian oil, currently under discussion within the European Union.
This embargo project, which needs the unanimity of the 27 Member States to be adopted, is still blocked by Hungary, which is very dependent on Russian oil and gas. Three other countries, Slovakia, the Czech Republic and Bulgaria have also expressed reservations.
Next week should be energy-defining. The European Commission must propose its RepowerEU plan aimed at reducing the EU’s dependence on Russian hydrocarbons. At the same time, the 27 EU member countries will try to agree on the sixth package of sanctions against Russia, the most important part of which is the embargo on Russian oil, proposed in early May by the President of the Commission , Ursula von der Leyen.
First disruptions in Russian energy supplies to the EU
Moreover, this week, for the first time since the start of the war in Ukraine, Russian energy exports were disrupted, with gas flows halted in two gas pipelines carrying Russian gas to Europe, including one crosses eastern Ukraine controlled by Russian troops and the other crosses Poland.
Russia also announced that it would stop supplying electricity to Finland on Saturday, officially for unpaid bills, the day after Helsinki announced a plan to apply for NATO membership.