US, Russian Crude Oil Sanctions "Still on the Table"

[Image source=EPA Yonhap News]

[Asia Economy New York=Special Correspondent Joselgina] The Biden administration confirmed that it is still discussing sanctions on Russian crude oil exports in response to Russia's invasion of Ukraine.

White House Press Secretary Jen Psaki said in an interview with CNN on the 2nd (local time), "What President Biden does not want is to disrupt the global crude oil market or shock more Americans with high energy and gas prices," but added, "It is still on the table."

She added, "this is how the President views the issue when we announce and push new measures," confirming that the Biden administration is considering both the necessity of sanctions against Russia and the stabilization of energy prices simultaneously.

At the end of last month, Press Secretary Psaki also confirmed that energy sanctions against Russia, including crude oil exports, are "all on the table," indicating that these measures could be taken at any time depending on Russia's actions.

Russia produces 12% of the world's crude oil and 17% of natural gas, so energy sanctions by Western countries would inevitably cause significant damage to the overall economy. However, in such a case, global raw material prices could soar and supply instability could intensify, so the United States has postponed such measures. Recently, geopolitical tensions between Russia and Ukraine have increased, and oil prices have surpassed $100 per barrel since the outbreak of the Ukraine crisis, reaching the highest level since 2014.

In the market, as economic sanctions against Russia have intensified, movements to avoid Russian crude oil imports have already been observed. Finnish refiner Neste Oy and Sweden's Preem have replaced Russian crude oil with Northern European crude. Texas-based refiner Valero Energy has completely stopped purchasing Russian crude. Despite the market price of Russian Urals crude being up to $18 per barrel lower than Brent crude, it is reported by The Wall Street Journal (WSJ) that buyers are still not found.

Yesterday, member countries of the International Energy Agency (IEA), including the United States and South Korea, agreed to release 60 million barrels of strategic reserves, but this only amounts to 12 days of Russian exports, and it is evaluated that there are limits to curbing the rise in oil prices.

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