Crude Oil Prices Soars to Record High as Talks on Russian Embargo Jitters Supply Concerns

Oil price soared to $120 level before briefly touching $139 a barrel after White House said it was discussion with allies to put embargo on Russian crude.

Brent oil futures gained as much as 18% in a matter of minutes before paring gains on Monday. Brent as of this report is trading at $128.56 per barrel while U.S. WTI is trading at $124.74 per barrel.

U.S. Secretary of State Antony Blinken said the Biden administration and its allies are in talks about banning the import of Russian oil as pressure mounts to hit back harder at the world’s third-biggest producer.

While traders, shippers, insurers and banks have been increasingly wary of taking on or funding purchases of Russian barrels, a formal embargo would increase the uncertainty that led to Brent trading in its biggest range since the launch of the futures contract in 1998.

It adds to more bullish news over the weekend, with Saudi Arabia hiking prices of its main crude blends and Libya saying its production has fallen because of a political crisis.

At the weekend, the International Monetary Fund warned that the war, as well as the subsequent sanctions imposed upon Russia, will have a “severe impact” on the global economy.

“While the situation remains highly fluid and the outlook is subject to extraordinary uncertainty, the economic consequences are already very serious,” the IMF said.