Oil prices rise as EU countries consider imposing ban on Russian oil

Crude oil futures extended gains on Tuesday on reports that some European Union members are considering slapping sanctions on Russian oil, as well as attacks on Saudi oil facilities.

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Front-month West Texas Intermediate futures rose $2.21, or 1.97%, to $114.33 a barrel on the New York Mercantile Exchange, while Brent futures rose $2.51, or 2.26%, to $118.23 a barrel on the Intercontinental Exchange.

On Monday, both futures had settled up more than 7% as the prospect of further supply interruptions weighed on the market.

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Foreign ministers in the European Union are divided on whether to join the United States in sanctioning Russian oil, with some nations, like Germany, claiming that the union is overdependent on Russia’s fossil fuels.

Targeting Russian energy exports, as the US and Britain have done, is a contentious issue for the EU, which relies on Russia for 40% of its gas.

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“The proposed ban is still some way from becoming policy because a significant number of EU nations oppose the ban,” analysts for the Commonwealth Bank of Australia wrote in a note.

“Still, the fact that the ban is being discussed at all is a significant shift,” the note added.

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“Why should Europe give Putin more time to earn more money from oil and gas? More time to use European ports? More time to use unsanctioned Russian banks in Europe? Time to pull the plug,” Lithuania’s Foreign Minister Gabrielius Landsbergis said on Twitter.

Simultaneously, Saudi Arabia has warned that it would not bear responsibility for any delays in global oil supplies caused by attacks on its oil facilities by Iranian-aligned Houthis.

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The remarks come after the group launched missiles and drones at Saudi oil facilities over the weekend, triggering a brief drop in refinery output.