LONDON (Bloomberg) —Brent oil soared to $95 a barrel for the first time since 2014 as political tensions between Ukraine and Russia intensified concern about tight global supplies.
The global benchmark jumped as much as 4.7%, while U.S. prices also climbed. National Security Advisor Jake Sullivan said that the U.S. claims Russia could take offensive military action or attempt to spark a conflict inside Ukraine as early as next week.
A potential Russian invasion of Ukraine could not only disrupt crude supplies but also could spark retaliatory sanctions by the U.S. Oil prices have soared in recent weeks on speculation that demand will outpace supply as the global economy rebounds from the pandemic.
OPEC said Thursday that the rebound in oil consumption could surpass its forecasts this year as economic activity improves and travel gathers pace. The OPEC+ coalition’s “chronic” struggle to revive output is also likely to support prices, unless the group’s Middle Eastern heavyweights pump more, according to the International Energy Agency.
“The oil market is incredibly tight,” Toril Bosoni, head of the IEA’s oil markets division, said in a Bloomberg Television interview on Friday. “Prices continue to surge and are now reaching levels that are uncomfortable for consumers across the world.”
Yet oil’s rally is still facing some headwinds, as officials from the U.S. to Europe have indicated that sides are closing in on a nuclear pact after talks resumed in Vienna on Tuesday.