CNBC reported that on January 10, oil prices increased sharply after the US Treasury Department announced extensive sanctions targeting the Russian oil industry, shaking the global energy market.
Brent oil price increased by 2.84 USD, equivalent to 3.69%, to 79.76 USD/barrel, while US crude oil (WTI) increased by 2.65 USD, equivalent to 3.58%, to 76.57 USD/barrel. This is the highest price since October, reflecting market concerns about major fluctuations.
The sanctions target major Russian oil companies such as Gazprom Neft and Surgutneftegaz, along with more than 180 tankers and many officials and leaders in the Russian energy sector, including Gazprom Neft CEO Aleksandr Valeryevich Dyukov.
According to the US Treasury Department, the sanctioned vessels are mainly from the Russian "shadow fleet" fleet - a group of vessels that have evaded previous sanctions to continue oil exports.
US Treasury Secretary quan quan Yellen said: The US is taking comprehensive action against Russias main source of income the financial source for the war in Ukraine. With these measures, we are increasing sanctions on Russian oil trade.
The energy market faces chaos as analysts predict that the sanctions will force India and China - two major buyers of Russian oil - to seek supply from the Middle East, pushing oil prices higher.
Mr. Bob Yawger, energy executive director at Mizuho Securities, commented: "The strong sanctions of the Joe Biden administration surprised the oil market, which had previously taken this risk lightly."
The Biden administration is stepping up pressure on Russia and providing Ukraine with aid ahead of President-elect Donald Trump's inauguration. Trump is expected to have a more dovish stance on Moscow.
Mr. Bob McNally, chairman of Rapidan Energy Group, said: Mr. Trumps teams response to these sanctions will be a key factor in determining whether oil price risks will continue to persist.
For his part, Russian President Vladimir Putin affirmed that Western sanctions were "unnecessary" and that Russia had overcome this pressure.
With sweeping sanctions, the global energy market continues to face the risk of price increases while Russia pledges not to back down. The confrontation between the US and Russia is pushing geopolitical tensions to a new level, with unpredictable impacts on the world economy.
