The jump in oil prices is adding to inflation concerns around the world. (Representative)
London:
Oil prices climbed near $100 a barrel on Tuesday as major crude producer Russia prepared to send troops to two separate regions of Ukraine, prompting Western nations to prepare for economic sanctions against Moscow.
After a sharp fall in the open, European stocks moved into positive territory as the Kremlin said it was open to all diplomatic contacts on Ukraine.
“The old adage that markets hate uncertainty and while this has become abundantly clear several times over the past few weeks, there is no doubt that investors continue to entice back at the slightest sign of diplomacy winning the day,” Market said. Analyst Craig Erlam at Oanda Trading Platform.
On Wall Street, the three main indices opened lower after a three-day holiday weekend, with the Dow falling 0.6 percent.
Asian stock markets had earlier ended their session with a sharp fall.
Brent North Sea crude oil rose to $99.50 a barrel, its highest level in seven years.
At around 1330 GMT, it reverted to just below $98, still up about 2.4 percent compared to late Monday.
Victoria Scholar, head of investment at Interactive, said: “The acute crisis between Russia and Ukraine has raised concerns about supply disruptions, which are crippling sanctions crippling Russia, the world’s second-largest oil exporter and the world’s top natural gas producer. will make it.” investor.
German Chancellor Olaf Scholz said he was suspending the Nord Stream 2 pipeline project with Russia in response to Moscow’s recognition of the broken areas Donetsk and Lugansk.
Ukrainian President Volodymyr Zelensky had called for an immediate halt to the project, which is set to pipe Russian natural gas to Germany through the Baltic Sea.
Zelensky said Russia should be punished with “immediate sanctions” for recognition of the territories occupied by Ukraine’s two separatists, including a “complete cessation of Nord Stream 2”.
It comes as the United States, Britain and the European Union are set to impose economic sanctions on Russia.
EU foreign policy chief Josep Borrell said: “Our response will be in the form of sanctions, the extent of which will be decided by the minister.”
Russia’s recognition of Ukraine’s separate regions would meanwhile “strongly exacerbate” economic uncertainty for the EU, said the bloc’s economy commissioner Paolo Gentiloni.
high energy prices
“Whatever happens next, one thing is clear: Energy prices are unlikely to bounce back in a hurry,” said ThinkMarkets analyst Fawad Razakzada.
“Rising inflation has already increased the disposable income of consumers, and if oil and other energy prices continue to rise, it could hurt the economic recovery, and raise concerns about a potential recession,” he said. Is.”
Russian troops are believed to have been stationed in Donetsk and Lugansk in eastern Ukraine after Russian President Vladimir Putin issued an order ordering his army to handle “peacekeeping” tasks in separatist areas.
The surge in oil prices is adding to concerns about inflation around the world, with the US Federal Reserve coming under intense pressure to tighten monetary policy to keep prices from spiraling out of control.
This, in turn, has battered the equity markets in recent months.
Russia’s MOEX index fell eight per cent at the open on Monday, down 10 per cent, but suffered too much loss to stand down 1.2 per cent in afternoon trading.
Heaven Investment gold climbed above $1,900 an ounce.
(Except for the title, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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