U.S. cuts Russian oil imports to minimize the impact on global supplies

U.S. cuts Russian oil imports to minimize the impact on global supplies

The Biden administration is considering reducing U.S. imports of Russian oil and measures to mitigate the impact on world supply and consumers, according to the White House, which came as Congress rushed through a bill that would completely ban Russian energy imports.

Oil prices have risen sharply in recent weeks as a result of sanctions imposed by the U.S. and its allies in response to Russia’s invasion of Ukraine.

The law is moving quickly through the Senate, and the White House may use it to impose import restrictions. In 2021, the U.S. imported around 20.4 million barrels of crude and finished products every month. 

Still, the White House is treading carefully, fearful of a surge in fuel costs, which would add to the country’s already-high inflation. It was about 7-8% of U.S. liquid fuel imports.

Gold had its best week in over two years, edging closer to the long-awaited $2,000 per ounce benchmark as growing Russian aggression in Ukraine heightened global risks, boosting the yellow metal.

Foreign corporations that abandon Russia, especially energy companies, will be seen to be pushing their Russian counterparts into “deliberate insolvency,” which under Russian law entails criminal prosecution of top executives.

Companies that leave Russia will be granted fast-track bankruptcy protection or transfer their holdings to local managers until they return.

Gold futures jumped 4.2 percent this week, the biggest weekly gain since July 2020.

In reaction to Russia’s invasion of Ukraine, an Alaska Republican presented bipartisan legislation on Thursday to limit Russian energy imports, calling it a deterrent to Russia weaponizing energy.

Following the Covid-19 outbreak in March 2020, the Federal Reserve cut interest rates near zero and maintained them there to help the economy recover. B.P. was the first one to declare a Russian divestment. Several other European oil corporations followed suit in a matter of days.

The rise in U.S. prices as a result of ultralow interest rates and trillions of dollars in pandemic-related spending has also helped gold’s position as an inflation hedge.

More at: FXreviewtrading.com

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