U.S. oil prices surged 10.8% Tuesday to surpass $106 per barrel for the first time in more than seven years following concerns over Russia’s invasion of Ukraine.
The price of West Texas Intermediate crude oil briefly passed the July 2014 high mark to $106.11 per barrel, according to CNBC. The increased prices are pressuring U.S. and world leaders to increase oil production or release emergency stockpiles of oil.
The International Energy Agency (IEA) issued a press release on Tuesday to announce the release of 60 million barrels of oil reserve to avoid any “shortfall in supplies” following Russia’s invasion.
“The 31 Member Countries of the Governing Board of the International Energy Agency agreed to release 60 million barrels of oil from their emergency reserves to send a unified and strong message to global oil markets that there will be no shortfall in supplies as a result of Russia’s invasion of Ukraine,” the IEA said in the statement.
The @IEA agreed today to release 60 million barrels of oil from emergency stocks to provide stability to global oil markets following Russia’s invasion of Ukraine.
Read our full statement ⬇️ https://t.co/VOPvDbAFDM
— Fatih Birol (@fbirol) March 1, 2022
“It is heartening to see how quickly the global community has united to condemn Russia’s actions and respond decisively,” IEA Executive Director Fatih Birol said.
“I am pleased that the IEA has also come together today to take action. The situation in energy markets is very serious and demands our full attention. Global energy security is under threat, putting the world economy at risk during a fragile stage of the recovery,” she added.
The statement also noted Russia’s massive impact on global energy. It noted the nation “is the world’s third largest oil producer and the largest exporter. Its exports of about 5 million barrels a day of crude oil represent roughly 12% of global trade.”
A growing number of American lawmakers believe it’s time to cut off buying oil from Russia. Florida Republican Sen. Marco Rubio appeared in an interview on Fox Business on Tuesday to urge President Joe Biden to stop sending oil money to Russian President Vladimir Putin’s nation.
“Under Joe Biden the U.S. is producing about 1.2 million fewer barrels oil per day That is $100 million every day from your pocket to criminals like #Putin Tonight Biden should announce we are going to reverse this,” he wrote on Twitter.
Under Joe Biden the U.S. is producing about 1.2 million fewer barrels oil per day
That is $100 million every day from your pocket to criminals like #Putin
Tonight Biden should announce we are going to reverse this pic.twitter.com/QoZ1Cwy8zF
— Marco Rubio (@marcorubio) March 1, 2022
On Sunday, two United Kingdom-based global petroleum giants have announced that they will be ending partnerships with Russian oil companies in response to the Russian invasion of Ukraine. The Daily Wire reported:
British Petroleum first announced Sunday that it was divesting from state-controlled Russian oil giant Rosneft. BP has had nearly a 20% stake in Rosneft since 2013, and both current BP CEO Bernard Looney and former CEO Bob Dudley served on Rosneft’s board of directors. In addition to severing its financial ties, Looney, who has been on the board of Rosneft since 2020, and Dudley, who has been on the board since 2013, will both resign from their positions.
“Russia’s attack on Ukraine is an act of aggression which is having tragic consequences across the region,” BP chair Helge Lund said in a statement. “[BP] has operated in Russia for over 30 years, working with brilliant Russian colleagues. However, this military action represents a fundamental change. It has led the [BP] board to conclude, after a thorough process, that our involvement with Rosneft, a state-owned enterprise, simply cannot continue. We can no longer support [BP] representatives holding a role on the Rosneft board. The Rosneft holding is no longer aligned with [BP’s] business and strategy and it is now the board’s decision to exit [BP’s] shareholding in Rosneft. The [BP] board believes these decisions are in the best long-term interests of all our shareholders.”