Uncertainty in the Petrol Market: The Impact of Sanctions

Petrol Prices Show a Horizontal Trend

Petrol prices are showing a horizontal trend following the implementation of sanctions by the United States against Russia's Rosneft PJSC and Lukoil PJSC companies and the European Union's efforts to tighten the screws on Moscow by seeking new measures.

Brent Oil and WTI Prices

Brent oil traded around 63 dollars per barrel after experiencing its largest decline of over %2 in a week on Wednesday. WTI continues to stay below 60 dollars. The penalties imposed by the US on Russian energy giants have led to shifts in trade, particularly impacting oil flows to India.

Excess Supply and Geopolitical Tensions

Oil is still heading towards an annual loss due to expectations of excess supply for the year, linked to the increased output by OPEC+ and other producers. However, the recently rising geopolitical tensions have added a risk premium to prices.

Russia's Export Problems

Russia's fuel exports have fallen to their lowest level since the start of the Ukraine invasion in the first half of November due to attacks on refinery infrastructure and US sanctions.

New Bidders for Lukoil

Following the sanctions, several buyers have emerged to purchase parts of Lukoil's international operations. Exxon Mobil executives met with Iraqi Oil Minister Hayyan Abdul Ghani to discuss the stake owned by a Russian company in the West Qurna 2 field, which constitutes 10% of the country.

New Restrictions from the European Union

Meanwhile, the European Union is working on additional restrictions against organizations supporting the "shadow fleet" tankers used by Moscow for oil transportation in order to undermine Russia's financing of the war in Ukraine.