Oil prices surge as EU leaders agree to ban 90% of Russian oil

After the end of the first day of a two-day summit held in Brussels on May 30, leaders of the European Union have agreed to a partial embargo on ban oil imports from Russia. The embargo covers oil that arrives by sea but not pipeline oil.

According to Charles Michel, president of the European Council, the sanctions agreed by the EU leaders “will immediately impact 75% of Russian oil imports”.

Ursula Von der Leyen, the head of the EU’s executive branch, said that this ban would “effectively cut around 90% of oil imports from Russia to the EU by the end of the year”, as Germany and Poland had voluntarily agreed to renounce all purchases of Russian oil via pipeline. Two thirds of the oil imported from Russia comes via tanker, while one third of them comes from the Druzhba pipeline.

Hungary, the Czech Republic and Slovakia will be temporarily exempt from the embargo.

Global oil benchmarks headed for the longest run of monthly gains in more than a decade, gaining support from the ban. Easing lockdown measures in China also drove oil prices higher.

During intraday sessions on Tuesday, Brent crude increased by $1.89 to $123.56/bbl, marking the highest level in two months, while WTI crude increased by $3.80 at $118.87/bbl.