CNN : After Russia invaded Ukraine, global oil prices experienced a dramatic spike. Just over a week ago, Brent crude leaped above $139 per barrel. Analysts warned prices could touch $185, then $200 as traders shunned Russian oil, pushing inflation even higher and adding huge strain to the global economy.
But there’s been a rapid reversal since then. Brent crude futures, the global benchmark, have cratered almost 30% from their peak. They’re trading below $100 per barrel after shedding another 7% on TuesdayWhat’s happening: The unusually sharp pullback has been driven by hopes that Saudi Arabia and the United Arab Emirates could boost oil production, and that demand from China could drop due to new coronavirus restrictions in major cities. This would ease the squeeze on the marke
Yet analysts warn that we’re not out of the woods yet. Oil is still trading significantly above what it costs to produce it, and extreme swings are likely to persist at a moment of huge uncertainty
“I wouldn’t rule out $200 a barrel just yet,” Bjørnar Tonhaugen, head of oil markets at Rystad Energy, told me. “It’s too soon”
Following the invasion, oil prices skyrocketed as traders began to see Russian crude exports as untouchable. This sparked concerns about how that supply of between 4 and 5 million barrels per day could be replaced, especially as demand for fuel ramps up over the summer. (CNN)
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