Crude oil prices surged sharply on Thursday, climbing more than 4%, after the European Union officially adopted its 19th package of sanctions against Russia, targeting the country’s shadow oil fleet and prohibiting imports of liquefied natural gas (LNG). The rally was further fueled by the United States imposing sanctions on Russian oil giants Rosneft and Lukoil, intensifying market concerns over supply disruptions.
At 4:22 a.m. ET, West Texas Intermediate (WTI) for December delivery rose 3.79% to $60.79 per barrel, while Brent crude for the same month gained 3.74% to $65.00 per barrel. Later in the morning, prices extended gains, with Brent futures up 4.3% at $65.30, and WTI up 4.4% at $61.06, according to Reuters data.
The sanctions are aimed at restricting Russia’s ability to finance its ongoing war in Ukraine. By targeting the shadow fleet — ships used to evade Western restrictions — and LNG imports, the EU and the U.S. are tightening the screws on Moscow’s energy revenue streams.
Market analysts noted that the sanctions are likely to have ripple effects across global trade. According to Ole Hansen of Saxo Bank, “Refineries in China and India will now need to seek alternative suppliers to avoid exclusion from the Western banking system,” suggesting a short-term reshuffle in the global crude supply chain.
The surge marks a continuation of bullish momentum from Wednesday’s session, with traders pricing in tighter supplies and potential logistical disruptions in global oil shipments.
While the latest sanctions add geopolitical risk premiums to prices, analysts caution that persistent global demand weakness and potential alternative sourcing could limit the upside in the longer term.
Brent and WTI both remain well below their mid-year highs but are now on track for their biggest two-day gain in over a month.
