Oil price hit US$100 per barrel for first time since 2014

Tanks move into the city, after Russian President Vladimir Putin authorized a military operation in eastern Ukraine, in Mariupol, February 24, 2022. REUTERS/Carlos Barria

KUALA LUMPUR: Brent crude oil prices jumped as high as US1$102 per barrel on Thursday, after Russian President Vladimir Putin authorised a military operation against Ukraine.

This is the first time since 2014 that Brent crude oil went above US$100 per barrel.

Russia is a key supplier of global energy, with Europe relying on about a quarter of its oil supplies and a third of its gas.

“All commodities prices shoot up following the news of Russia launching a full-scale invasion in Ukraine.

“The news was a surprise as the market does not anticipate such a move, especially the importance of Russia in the energy market.

“If the situation is prolonged, inflationary pressure could escalate further. It’s going to be a high inflation world going forward,” said an analyst with a private fund.

The escalation between Russia and Ukraine has spooked a market, especially with the tight oil market around the world, as demand exceeds supply.

According to the International Energy Agency (IEA), if Opec+ coalition (the Organization of the Petroleum Exporting Countries plus allies) continues to fail in delivering its oil production targets amid rising demand and inventories at multi-year lows, oil prices will remain under upward pressure and are set for more volatility, the International Energy Agency (IEA) said earlier this month.