US President Biden Announces Ban on Russian Oil

  • USOil
    (${instrument.percentChange}%)

US Bans Russian Oil

US President Biden just announced that oil from Russia will no longer be acceptable in US ports, escalating recent sanction against the country, as a retaliation to the invasion in Ukraine. [1]

The White House had opened the door to such a move, but there had been some hesitancy to pull the trigger, given surging inflation that has been a constant headache for the Biden administration.

On Sunday, US House Speaker Ms Pelosi had announced that lawmakers are already exploring legislation, which "would ban the import of Russian oil and energy products into the United States", putting pressure on the White house to act first. [2]

US Secretary of State Blinken had noted that "We are now in very active discussions with our European partners about banning the import of Russian oil to our countries", in a CNN interview on Sunday. [3]

The European Union did not follow the United States as it is much more dependent on Russian supply of energy, but it did announce earlier a plan to reduce its reliance. The European Commission proposed a plan to plan to make Europe independent from Russian fossil fuels well before 2030, which can reduce EU demand for Russian gas by two thirds before the end of the year. [4]

Russian Energy Supply

Russia is the world's third largest oil producer behind the US and Saudi Arabia, with its total production standing at 11.3 million barrels/day in January, as per the International Energy Agency (IEA). It is also the biggest exporter, having exported 7.8 million barrels/day in December 2021. [5]

US exposure on Russian oil is relatively limited, with only around 7% of the petroleum imports gaving come from the country in 2020. [6]

The European Union imports 90% of its gas consumption, with Russia providing around 45% of those imports, in varying levels across Member States. Russia also accounts for around 25% of oil imports and 45% of coal imports. [4]

USOIL

USOIL extends it advance to fresh levels not seen since July 2008, gaining more than 5% on the day, at the time of writing.

Nikos Tzabouras

Senior Market Specialist

Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.

With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.

References

1

Retrieved 08 Mar 2022 https://twitter.com/i/broadcasts/1ZkKzbqezRvKv

2

Retrieved 08 Mar 2022 https://www.speaker.gov/newsroom/3622

3

Retrieved 08 Mar 2022 https://www.state.gov/secretary-antony-j-blinken-on-nbc-meet-the-press-with-chuck-todd/

4

Retrieved 08 Mar 2022 https://ec.europa.eu/commission/presscorner/detail/en/ip_22_1511

5

Retrieved 08 Mar 2022 https://www.iea.org/reports/russian-supplies-to-global-energy-markets/oil-market-and-russian-supply-2

6

Retrieved 24 Jun 2022 https://www.eia.gov/tools/faqs/faq.php

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