What does banning Russian oil mean for global energy markets?

What does banning Russian oil mean for global energy markets?

The White House ban on imports of Russian petroleum into the US, announcedon Tuesday, is the most significant move yet in a rapidly escalating global energy war between Russia and the west following Vladimir Putin’s invasion of Ukraine.

Brent oil settled 4 per cent higher at $127.98 a barrel on Tuesday, a day after hitting its highest intraday level since the global financial crisis, while US petrol prices hit a new high.

As analysts warn that further escalation is likely, here is a guide to what the ban means for global markets and its potential fallout.

What has been announced — and what hasn’t?

President Joe Biden’s executive order bans US imports of crude and oil products, coal and liquefied natural gas, with a 45-day winding-down period for existing contracts. It also bars American companies from investing in Russia’s energy industry.

The UK said it too will phase out oil imports, with companies being given until the end of the year to cut off shipments. Canada, which imports negligible amounts of Russian petroleum, had already announced a similar ban.

But this is not an attempt to embargo Russian oil exports to the world, as happened when Iranian oil was largely cut off from global markets, most