Crude oil futures closed lower on Tuesday (March 22) following reports that European Union (EU) member states are divided over sanctions against Russia, particularly Germany, which is heavily dependent on Russian energy supplies.
- WTI crude futures were down 36 cents, or 0.3%, at $111.76 a barrel.
- BRENT crude futures fell 14 cents, or 0.2%, at $115.48 a barrel.
EU governments are considering whether to impose sanctions on Russian oil imports. This week, EU leaders are meeting with U.S. President Joe Biden to discuss a policy against Russia’s military invasion of Ukraine last month.
A senior EU ambassador said yesterday that the EU is in the process of imposing the fifth round of sanctions against Russia. Ahead of the meeting, EU foreign ministers met with U.S. President Biden yesterday. They discussed possible sanctions against Russian energy imports but failed to reach an agreement. The EU is too dependent on Russian energy products, so sanctions would cause more harm to the EU than to Russia.
Germany in particular has warned that the EU is too dependent on Russian oil to decide to suspend Russian oil imports. German Foreign Minister Annalena Baerbock said,
“The question of an oil embargo is not a question of whether we want or don’t want, but a question of how much we depend on oil. Germany is importing a lot, but there are also other member states who can’t stop the oil imports from one day to the other.”
Despite the four rounds of sanctions imposed on Russia, the country has shown no signs of backing down from Ukraine, prompting the EU to consider tougher measures. Such as sanctions against Russian oil, which the United States and the United Kingdom have already announced.
Investors are looking ahead today to the weekly oil inventory report from the U.S. Energy Information Administration (EIA).
The Spot Market is Open
Wednesday, March 23, 2022