(BFM Bourse) – A few days after the barrel of Brent, that of WTI also exceeded the symbolic – and psychological – cap of 100 dollars for the first time since 2014. Beyond possible disruptions in the Russian supply, the operators of the market are worried about the sanctions that should target the sector.
Very clever who can say how the ongoing armed conflict on Ukrainian soil will end. One thing nevertheless seems certain: the Russian economy will not escape -very- severe Western sanctions, and probably for several years. The European Union announced economic reprisals last week, before significantly toughening its tone over the weekend, notably excluding Russia from the Swift interbank platform while freezing the assets of the Russian central bank abroad. .
If these measures are already being felt harshly in Russia, where the ruble is sinking to historic lows, they in no way affect Vladimir Putin’s desire to vassalize Ukraine. The Kremlin announced on Tuesday, through its Defense Minister Sergei Shoigu, that it would “continue its offensive until all objectives are achieved”, namely “demilitarization” and ” denazification” of Ukraine. Faced with this observation, the West seems determined to move up a gear in terms of sanctions.
“The issue of direct sanctions on Russian oil and gas exports is a matter of timing, not probability,” said Markets.com analyst Neil Wilson. “We will definitely” take new sanctions against Russia, German Chancellor Olaf Scholz warned on Tuesday. Across the Atlantic, Canadian Prime Minister Justin Trudeau announced on Monday a ban on all imports of Russian crude oil – although these are very limited in Canada, compared to the appetite of European countries for crude and gas. Russian natural.
This prospect therefore leads to a new surge in the prices of the main crude oil benchmarks, the day after an (already) clearly bullish session, despite “the fact that the Swift measures taken by Europe seem to leave the door open to energy payments to entities Russians” underlined Jeffrey Halley, analyst at Oanda.
Around 4:45 p.m., the futures contract on a barrel of Brent jumped 8.1% to 105.9 dollars, the highest since the summer. The contract on the North American benchmark, “West Texas Intermediate”, also clearly crossed the $100 threshold (+8.9% to $104.2) – less than two years after falling into negative territory for the first time. of all history.
Already up sharply in the morning in the face of the intensification of the Russian offensive, oil prices further increased their gains after the announcement, by the spokesman of the Russian Ministry of Defense at the beginning of the afternoon, that Russian troops and pro-Russian separatist forces from eastern Ukraine crossed the Sea of Azov coast on Tuesday. Unknown, this “small” sea of 35,000 km² is strategic since its shores host two major ports, those of Mariupol and Berdiansk, vital to the Ukrainian economy because they are the starting points for grain and steel exports in particular.
Oil is also under pressure by the decisions of the European oil “supermajors”, which have announced that they will abandon numerous investments on Russian soil. “The business world is building a fortress to isolate Russia from the international community,” said Susannah Streeter, analyst for Hargreaves Lansdown. Companies around the world are responding to Russia “by freezing transactions with Moscow and abandoning financial investments worth billions”, she continues.
The Anglo-Dutch hydrocarbons giant Shell announced on Monday that it would part with its shares in several joint projects with the Russian group Gazprom in Russia, due to the Russian invasion of Ukraine, following the example of its compatriot BP which is withdrawing from the Russian giant Rosneft. The French TotalEnergies (notably present in Russia via its 19.4% stake in the company Novatek) has not gone so far since it is not completely withdrawing from the country, but indicated on Tuesday that “it ‘will bring more capital to new projects in Russia’. Maersk, the Danish shipping giant, also announced today the suspension of new orders from and to Russian ports, excluding food, medical and humanitarian goods.
Enough to cause “a disruption of shipments from Russia with cancellations of cargo reservations”, with the consequence of an increase in energy prices “in the short term, without Russia turning off the taps”, advances Susannah Streeter .
There remains an unknown factor and not the least important: Moscow’s reaction to these sanctions. “Fears that Russia will retaliate by using its energy exports as a weapon are keeping oil and gas prices high,” the specialist said.
At the end of the afternoon on Tuesday, the outbreak subsided very slightly after the announcement by the International Energy Agency of the release, by its member countries, of 60 million barrels of oil from their emergency supplies. A decision to “send a united and strong message to world oil markets that there will be no shortage of supply resulting from the Russian invasion of Ukraine”, according to the institution.
Quentin Soubranne – ©2022 BFM Bourse