Oil Approaches $100 a Barrel As Russia Escalates Ukraine Standoff

Oil drums sitting over blue financial graph background.
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Crude oil prices moved closer to $100 a barrel Tuesday as the prospect of war between Russia and Ukraine spooked the energy markets, prompting the Biden administration to consider releasing more of the United States’ oil reserves.

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The price of Brent crude climbed 3.5% to about $99 a barrel, its highest point in seven years, The New York Times reported. West Texas Intermediate rose about 5% to just less than $95.50 a barrel.

European natural gas futures spiked more than 13% Tuesday amid concerns that Russian oil — which provides more than one-third of Europe’s supply and 11% of the world’s total — could get cut off by countries threatening sanctions.

Oil prices had been flat for a week or so before rising Sunday after more Russian troops were mobilized at Ukraine’s border.

As tensions escalate in the region, President Joe Biden has once again broached the idea of tapping into U.S. oil reserves, the Washington Post reported, citing two people two people with knowledge of the matter. Discussions about releasing American oil are “preliminary,” the sources said, and part of a broader White House plan to keep oil and gas prices from rising much further.

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The administration is also considering a federal gas tax holiday to contain prices at the pump. As GOBankingRates previously reported, a group of Senate Democrats introduced a bill that would suspend the gas tax — currently, about 18 cents per gallon — for the remainder of the year, and the White House has said it is open to the idea if it manages to pass Congress.

Last fall Biden released 50 million barrels of oil from the Strategic Petroleum Reserve after global supply chain disruptions contributed to a spike in gas prices.

Currently, the average price of regular gasoline in the U.S. is $3.531 a gallon, according to AAA. That’s up from $3.498 a week ago, $3.328 a month ago and $2.635 a year ago.

Those prices could move even higher if the Russia-Ukraine situation worsens, experts say.

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In a Monday update from GasBuddy.com, petroleum analyst Patrick DeHaan said the coming weeks could get “ugly,” WTHR reported. The reason: Gas prices tend to surge in the spring because of the seasonal change to the summer gasoline mix, scheduled maintenance at refineries and rising travel demand.

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About the Author

Vance Cariaga is a London-based writer, editor and journalist who previously held staff positions at Investor’s Business Daily, The Charlotte Business Journal and The Charlotte Observer. His work also appeared in Charlotte Magazine, Street & Smith’s Sports Business Journal and Business North Carolina magazine. He holds a B.A. in English from Appalachian State University and studied journalism at the University of South Carolina. His reporting earned awards from the North Carolina Press Association, the Green Eyeshade Awards and AlterNet. In addition to journalism, he has worked in banking, accounting and restaurant management. A native of North Carolina who also writes fiction, Vance’s short story, “Saint Christopher,” placed second in the 2019 Writer’s Digest Short Short Story Competition. Two of his short stories appear in With One Eye on the Cows, an anthology published by Ad Hoc Fiction in 2019. His debut novel, Voodoo Hideaway, was published in 2021 by Atmosphere Press.
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