Crude oil prices rose in Asia today on increased geopolitical tensions as the US hinted at fresh sanctions against Moscow after Crimea voted in a referendum to break away from Ukraine and join Russia.
The US strongly rejected the vote yesterday, saying it violated Ukraine’s constitution and was carried out “under duress of Russian military intervention”.
New York’s main contract, West Texas Intermediate for April delivery, was up 23 cents to $99.12 in mid-morning Asian trade, and Brent North Sea crude for May gained 11 cents to $108.32.
Tan Chee Tat, investment analyst at Phillip Futures in Singapore, said US-led Western powers are likely to impose additional sanctions on Russia, which is seen as having orchestrated Crimea’s breakaway after a pro-Western government took over in Kiev.
Investors are worried that potential sanctions against Russia could disrupt gas and oil supplies from the country.
More than 70 per cent of Russia’s gas and oil exports to Europe pass through Ukraine.
Traders are also keeping an eye on the new Federal Reserve’s next policy meeting tomorrow and Wednesday.
The US central bank is expected to further cut its economic stimulus programme as the economy shows further signs of recovery.
The health of the US economy is a key influence on oil prices as the US is the world’s biggest oil consuming nation.