Brent crude hits $130 per barrel; fuel prices to go up again

The price of crude oil hit $130 per barrel for the first time since 2008.

The market reacted to supply disruptions stemming from Russia’s ongoing invasion of Ukraine and the possibility of a ban on Russian oil and natural gas.

The U.S. oil benchmark, West Texas Intermediate crude futures, spiked nearly 9% higher to $126.05 per barrel.

The international benchmark, Brent crude, soared 9.9% higher to $129.75. Brent hit a high of $139.13 at one point overnight, its highest since July 2008.

“Oil is rising on the prospect for a full embargo of Russian oil and products,” said John Kilduff of Again Capital.

“Already high gasoline prices are going to keep going up in a jarring fashion. Prices in some states will be pushing $5 pretty quickly.”

The U.S. and its allies are considering banning Russian oil and natural gas imports, Secretary of State Antony Blinken said in an interview with CNN’s “State of the Union” on Sunday.

“We are now talking to our European partners and allies to look in a coordinated way at the prospect of banning the import of Russian oil while making sure that there is still an appropriate supply of oil on world markets,” he said. “That’s a very active discussion as we speak.”

The rising oil prices indicate that fuel prices will go up again at the pumps, beginning Wednesday 16th March, 2022, if government does not intervene.

The rising oil prices and the depreciation of the cedi are fuelling the surge in prices of petroleum products on the domestic market.

Though, the Ghana government will benefit significantly from the windfall of the commodity, after budgeting $62 per barrel in the 2022 Budget and Economic Policy, consumers will have to bear the brunt of the rising fuel prices.

This will consequently push inflation up, whilst cost of living is expected to go up.