Key Takeaways
- US sanctions on Rosneft and Lukoil pushed oil prices up 2.8%
- Brent crude rose to $64.35, WTI reached $60.18
- EU and Britain also imposed additional sanctions on Russian energy
Oil prices extended gains for the second consecutive session, climbing over 2.8% after the United States imposed direct sanctions on Russia’s largest oil companies. The move targets Rosneft and Lukoil, which the US Treasury says fund Moscow’s war efforts in Ukraine.
Brent crude futures surged $1.76 to $64.35 per barrel, while US West Texas Intermediate crude jumped $1.68 to $60.18. The price increase came as Washington called for an immediate ceasefire and signaled readiness for further action.
“Given President Putin’s refusal to end this senseless war, Treasury is sanctioning Russia’s two largest oil companies that fund the Kremlin’s war machine,” Treasury Secretary Scott Bessent said in a statement.
International Sanctions Expand
The US action follows Britain’s sanctions against the same companies last week. European Union countries separately approved their 19th sanctions package, including a ban on Russian liquefied natural gas imports.
Market analysts noted the price response has been relatively measured despite the significant sanctions announcement.
“While the sanction news has buoyed the crude oil price, the rise thus far has been relatively modest because past sanction/tariff threats have been diluted or delayed and also by the difficulties of enforcing the sanctions,” said Tony Sycamore, a market analyst at IG.
Immediate Market Impact and Regional Pressure
Immediately after the sanctions announcement, both Brent and WTI futures spiked more than $2 per barrel. The rally was further supported by growing US energy demand.
The Biden administration has also pressured Asian allies, including Japan, to halt Russian energy imports. This comes ahead of the President’s upcoming visit to the region as Washington intensifies efforts to phase out Russian energy supplies globally.
