International oil prices surge above $100 per barrel as Russia invades Ukraine

International oil prices crossed the $100 per barrel mark for the first time in seven years after Russia announced a military operation in Ukraine, AFP reported.

As of 9 pm, the price of Brent crude rose to $103.82 (or Rs 7,860.73), an increase of $6.98 (Rs 528.49) or 7.21%, according to Bloomberg. Brent is a global price benchmark for crude oils from the Atlantic basin. It is used to set the price of two-thirds of the world’s trade of crude oil supply.

The United States West Texas Intermediate, or WTI, jumped $5.86 (Rs 443.69), or 6.36%, to $97.96 (Rs 7417.04) a barrel.

Warren Patterson, head of ING’s commodity research, said that oil prices are likely to remain volatile.

“This growing uncertainty during a time when the oil market is already tight does leave it vulnerable,” Patterson said, according to Reuters. “Prices are likely to remain volatile and elevated.”

The oil prices surged as Russia announced a “military operation” in Ukraine following months of tension between them. Russia’s attacks has aggravated concerns about disruptions to global oil supply, according to Reuters.

Amid the crisis between Russia and Ukraine, several countries, including the United States, and the European Union imposed sanctions on Moscow, while others are mulling similar action.

“If sanctions affect payment transactions, Russian banks and possibly also the insurance that covers Russian oil and gas deliveries, supply outages cannot be excluded,” Commerzbank analyst Carsten Fritsch told Reuters.

Russia is the largest supplier of natural gas to Europe, providing about 35% of its supply.

“Russia is the third-largest oil producer and second-largest oil exporter,” UBS analyst Giovanni Staunovo told the news agency. “Given low inventories and dwindling spare capacity, the oil market cannot afford large supply disruptions.”