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25 Mar 2022
Oil Drops as Supply Disruption Worries Relax as Trade Costs Mount
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Oil prices plummeted on Friday amid retreating supply concerns as the EU remains undecided on imposing a ban on Russian oil imports while the U.S. and its allies contemplate turning to their own reserves.
According to Reuters, Brent crude futures dipped by 0.4% to $118.57 a barrel at 0529 GMT. U.S. West Texas Intermediate (WTI) crude futures also slumped by 0.4% to $111.87 per barrel.
Even though the U.S. and its ally countries have implemented an embargo on Russian oil in retaliation to the Kremlin’s invasion of Ukraine, the European Union remains apprehensive to follow suit since Russia supplies 40% of its gas.
National Australia Bank’s Commodities Analyst Baden Moore contended, "You're continuing to erode inventories. That implies, on current settings, the market continues to be tight."
On Friday, the Intercontinental Exchange also hiked margins for Brent crude May contract by 19% on account of current market volatility, adding to the rise in oil trade prices.
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