TOKYO: Crude oil jumped in the international market while the Russian currency rouble plunged nearly 30% to a fresh record low on Monday after the West imposed new sanctions on Moscow including blocking some banks from the SWIFT international payments system.
Safe-haven demand boosted bond yields along with the dollar and yen while the euro sank after Russian President Vladimir Putin put nuclear-armed forces on high alert on Sunday.
The ramp-up in tensions heightened fears that oil supplies from the world’s second-largest producer could be disrupted, sending Brent crude futures up $4.21 or 4.3% at $102.14. US West Texas Intermediate (WTI) crude futures were up $4.58 or 5.0% at $96.17 a barrel.
President Vladimir Putin put Russia’s nuclear deterrent on high alert on Sunday in the face of a barrage of Western reprisals for his war on Ukraine, which said it had repelled Russian ground forces attacking its biggest cities.
The United States said Putin was escalating the war with “dangerous rhetoric”, amid signs that the assault was not producing rapid victories, but instead generating a far-reaching and concerted Western response.
Less than four days after it started, the invasion has triggered a Western political, strategic, economic, and corporate response unprecedented in its extent and coordination.
British oil major BP, the biggest foreign investor in Russia, said it was abandoning its stake in the state oil company Rosneft at a cost of up to $25 billion, shrinking its oil and gas reserves in half.
Several European subsidiaries of Sberbank Russia, majority-owned by the Russian government, were failing or were likely to fail due to the reputational cost of the war in Ukraine, the European Central Bank said.
