Oil jumps 4% amid EU plans to ban Russian oil

Oil prices are up on Wednesday morning as the market reacts to the European Union (EU)’s latest plans on Russian oil.

Since the start of the Ukraine-Russia war, one of the main uncertainties (amid tougher sanctions) has been the EU’s eventual decision on imports of Russian oil and gas. 

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Today, the European Commission said it’s time to have a complete ban on all oil imports, a move that resulted in an uptick in oil prices.

Oil price outlook today

Oil prices have fluctuated heavily over the past few months, with geopolitical turmoil and other demand factors at the center of the swings.

On Wednesday, the international benchmark Brent crude was up $4.66, or 4.55%, at $109.30 a barrel.  West Texas Intermediate (WTI) crude futures rose by 4.5%, adding $4.42 to $106.90 per barrel.

EU to ban Russian oil imports

European Commission President Ursula von der Leyen, in an address to the European Parliament, has outlined a phased-out approach that should see the EU ban oil imports from Russia. 

According to her, implementing a “complete import ban on all Russian oil” won’t be easy. But it has to be done, she noted.

Let us be clear: it will not be easy. Some Member States are strongly dependent on Russian oil. But we simply have to work on it. We now propose a ban on Russian oil. This will be a complete import ban on all Russian oil, seaborne and pipeline, crude and refined.”

European Commission President Ursula von der Leyen

Von der Leyen said the embargo would involve gradual cuts to imports of crude within six months. On top of that, she would like to see the importation of refined oil products from Russia phased out by the end of 2022.

The move, according to the EC president, aims at maximizing pressure on Russia while, at the same time, limiting the impact on the EU economy.