The price of a barrel of “Brent” North Sea crude approached $140 yesterday evening, and fell below its record level of 147.50 recorded in July 2008.
After dropping from 4% to 6% Friday, European stock exchanges opened significantly lower again. In the morning, the Frankfurt Stock Exchange fell by 4.48%, Paris by 4.25%, and Milan by 5.28%, while the London Stock Exchange, which was the most flexible since the beginning of this crisis, fell by 2.42%.
In the same context, the price of an ounce of gold briefly exceeded $2000, in a precedent since August 2020, and the dollar rose by 0.66% against the euro.
In the face of the worsening situation in Ukraine, US Secretary of State Anthony Blinken said yesterday that the United States and the European Union were discussing “intensively” the possibility of banning imports of Russian oil.
However, the Europeans adopt a more cautious stance, as many countries in Europe, such as Germany, are closely dependent on Russian oil and gas.
Although Russian oil is not currently subject to direct sanctions in theory, almost no one can buy it, which greatly affects global supply.
“If the war does not stop, nothing appears on the horizon that will slow down” the rise in oil prices, said a note issued by the National Australia Bank today.
“The prolonged rise in oil and raw materials prices is likely to lead to European economies rationalizing consumption, and will affect the economic recovery and corporate profits in 2022,” said Ipek Ozkardskaya, an analyst at Swissquote Bank.
Aluminum and copper at the lowest level
The International Monetary Fund warned on Saturday that the escalation of the conflict in Ukraine would have “devastating” economic repercussions at the global level.
In addition to the conflict itself, the sanctions imposed on Russia will “have a very significant impact on the global economy and financial markets, with collateral repercussions on other countries,” according to the fund.
For his part, analyst at CMC Markets, Michael Hewson, said: “While the prospects for economic growth have become bleak, inflation is worse, because energy and agricultural raw materials prices have risen significantly since the beginning of the year, and this negative mix poses a major problem for central banks. ».
Metals prices also continued to rise, as aluminum crossed the $4,000 per ton threshold for the first time, and copper reached a new historic high of $10,845 per ton.
In this context, investors will Thursday scrutinize the US consumer price index in February, and will pay close attention to the conclusions of the European Central Bank’s monetary policy meeting on the same day.