Oil prices have been fluctuating since Russia’s invasion of Ukraine as Western countries have rushed to impose a plethora of economic sanctions, including a U.S. import embargo on Russian oil. Because Russia is the second-largest global exporter of oil, these sanctions have caused crude oil to experience wild price swings.
In order to offset rising energy costs, the Biden administration last week announced the release of 1 million barrels of oil per day from the nation’s strategic reserves. The U.S. Energy Information Administration expects the increased supply to lower the oil prices by as much as 50%. Following this news, benchmark crude oil futures dipped 4%. However, in the wake of war crimes allegedly committed by Russia in Ukraine, and Russia’s demand for oil payment in rubles, many European countries are exploring a potential oil import bans of their own. This could cause crude oil prices to spike again.
