Brent crude on Thursday jumped to a record $101 after the invasion of Eastern Ukraine by Russia.
The development has also seen the Moscow stock exchange suspending trading.
Vladimir Putin, Russian President had earlier in a broadcast announced that the military operation in Ukraine was to demilitarize the country’s forces.
Russian forces reportedly attacked military facilities in Ukraine but military forces in Kyiv have also reported shooting down a military jet belonging to Russian.
Impact Of Russia-Ukraine War On Oil Prices
Russia is the world’s second-largest oil producer, which mainly sells crude to European refineries, and is the largest supplier of natural gas to Europe, providing about 35 per cent of its supply.
“Russia’s announcement of a special military operation into Ukraine has pushed Brent to the $100/bbl mark,” said Warren Patterson, head of ING’s commodity research, adding that the oil market will nervously be awaiting what further action Western nations take against Russia.
“This growing uncertainty during a time when the oil market is already tight does leave it vulnerable, and so prices are likely to remain volatile and elevated,” he added.
Additionally, U.S. crude stockpiles rose 6 million barrels last week while distillate stocks fell, according to market sources who were citing American Petroleum Institute figures late on Tuesday.
Ahead of government data on Thursday, analysts forecast a 400,000-barrel build in crude and a drawdown in fuel stockpiles.
Gasoline inventories rose by 427,000 barrels and distillates stockpiles fell by 985,000 barrels, the API data showed according to the sources, who spoke on condition of anonymity.
Additional report from IndiaToday