Oil prices plunging due to Ukraine tensions

Brent crude prices decreased by 1.8 percent, more than US$2 per barrel on Wednesday.

Oil prices plunging due to Ukraine tensions

World Bulletin / News Desk

Brent crude oil prices have decreased by 1.8 percent, more than US$2 per barrel, following a supply concern plunging on easing Ukraine tensions.

Brent crude oil prices dropped as low as US$108.41 on Wednesday; currently, it is trading US$108.60 and U.S. West Texas crude oil prices was down from US$104.82 to US$103.36 a barrel.

Brent crude oil prices increased by 1.6 percent, more than US$2 per barrel, on Monday, in response to rising tension in Ukraine since Russian President Vladimir Putin declared that Moscow had the right to ‘defend Russian interests’ in the Crimea region.

Since Russia’s declaration, Brent crude oil has hit a session peak of US$111.38 per barrel, having closed at US$109.11 per barrel on Friday.

U.S. West Texas crude oil prices have jumped to US$104.65 a barrel, the highest since September 23 last year; it closed at US$102.68 on Friday.

Russia, which is a major regional supplier of gas and oil, secured permission from its parliament on Saturday to use military force in Crimea, which has a majority ethnic-Russian population in protest with the interim government in Kiev.

Russia is the world's biggest oil producer, exporting more than 5 million barrels of crude oil a day. It currently supplies 25 percent of Europe's gas imports, and many European countries rely almost entirely on Moscow for their imported gas.

Russia’s state-owned energy giant Gazprom sold 162.7 billion cubic meters of natural gas to Europe last year; the supply of Russian natural gas to Europe grew by 16 percent in 2013.

Ukraine conflict unlikely to affect Turkey's energy

The Ukraine crisis will not result in an energy crisis for Turkey, Energy Minister Taner Yildiz said, due to the recent easing of tensions by Russia’s President Vladimir Putin’s statements.

If Russia disrupts or halts the flow of natural gas through Ukraine to Turkey - Turkey receives a quarter of its natural gas supply from Ukraine – it will be seriously affected, Yildiz said, during a joint press conference with Minister of Energy, Mining and Industry of the Federation of Bosnia and Herzegovina, Erdal Trhulj.

Turkey receives half of its total natural gas supply from Russia, half of which comes via Ukraine. The latest developments in Ukraine, which intensified after Russian forces advanced through Crimea, increased fears of interruptions in Turkey’s energy supply, and spikes in global energy prices.

“I don’t think the crisis will escalate to that critical level after Putin’s statements eased the tensions. We also had contact with Gazprom and we do not expect any interruptions regarding the supply.”

Last Mod: 05 Mart 2014, 16:46
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