Oil prices surge as Ukraine-Russia tension climb

Oil and gas prices are climbing on fears that the Ukraine-Russia crisis will disrupt supplies across the world.

U.S. West Texas Intermediate (WTI) crude futures rose to $91.56 a barrel, and Brent crude futures were up $99.38 a barrel today.

Yesterday, French President Emmanuel Macron said that U.S. President Joe Biden and Russian President Vladimir Putin have agreed to a summit over Ukraine. Still, the Kremlin said there was no confirmation on the immediate meeting as U.S. markets were closed on Monday for the Presidents Day holiday.

Helima Croft, global head of commodity strategy at RBC, said, “Energy could be clear collateral damage of a kinetic conflict between Russia and Ukraine.”

” Russia would be cut off from international financial markets and denied access to major exports needed to modernize its economy if it invaded Ukraine,” European Commission President Ursula von der Leyen commented.

Rejecting calls to pump more to ease pressure on prices, Ministers of Arab oil-producing countries said on Sunday that OPEC+ should stick to its current agreement to add 400,000 barrels per day (BPD) of oil output each month.

With the possibility of more than 1 million BPD of Iranian crude returning to the market, Price gains have been limited.

“Significant progress” had been made in talks to revive Iran’s 2015 nuclear agreement on Monday after a senior European Union official said on Friday that a deal was “very, very close,” Iranian foreign ministry spokesperson Saeed Khatibzadeh said.

Commonwealth Bank analyst Vivek Dhar said in a note, “If a Russian invasion takes place, as the U.S. and U.K. have warned in recent days, Brent futures could spike above $100/bbl, even if an Iranian deal is reached,”.

Analysts visioned that market remained tight, and any addition of oil would help. Still, prices would remain volatile in the near term because Iranian crude is unlikely to return until later this year.