US bans Russian oil imports over Ukraine

Britain to phase it out by the end of the year.

The United States, the world’s biggest consumer of oil, on Tuesday banned Russian oil and other energy imports in retaliation for Moscow’s invasion of Ukraine.

The ban on Russia, the world’s top exporter of more than 7 million barrels per day of crude oil and petroleum products, exacerbated supply concerns and powered oil prices higher, with global benchmark Brent crude LCOc1 surging past $133 a barrel. O/R

Britain also said it will phase out the import of Russian crude and oil products by the end of 2022.


 Bjørnar Tonhaugen, head of oil markets, Rystad Energy

“The 4.3 million barrels per day (bpd) of ‘Western’ crude imports from Russia in January 2022 cannot be replaced by other sources of oil supply in a short period of time. Therefore, oil prices must rise to destroy sufficient demand and incentivize a supply response through higher activity – both of which will happen with a time lag of several months – to rebalance the market at a higher price.”

“How high oil prices will need to go depends primarily on how much and for how long the market will need to shun export barrels from Russia and whether other buyers, such as China, will step in to increase its purchases of oil from Russia.”

Pat Thaker, editorial director, Middle East & Africa, Economist Intelligence Unit:

“Driven by headlines, the international oil market continues to create havoc with oil prices. Russian imports make up a tiny amount of U.S. energy needs, but Joe Biden’s bold unilateral ban on imports of Russian oil, LNG, and coal as part of the latest round of sanctions pushed oil prices to pass $120/barrel. Europe’s move in the same direction is likely to be slower, but the ripple effects from the invasion, oil sanctions against an extremely tight energy market, points to elevated triple digit prices remaining for the moment.”

Gary Cunningham, director of market research at Tradition Energy

“We feel like this might be a little overbought at this moment – Russia represents a tiny part of U.S. purchases. Don’t think the global supply-demand balance is so massively impacted by the embargo. We would expect prices to start to retract at some point soon as countries start making clear which ones will join in the embargo.”

Matt Smith, lead oil analyst, Kpler

“This is just one more escalation in a series of events that we’ve seen in recent days to push crude and product prices higher. The market is again pricing in one more source of supply loss.”

“Even though the U.S. is not a huge importer of Russian crude & products, it’s just one more region shunning Russian oil, so it will have to be replaced from somewhere else.”

Craig Erlam, senior market analyst, Oanda

“The move is lifting the oil price as it could lead to retaliation or others following in the U.S.’ footsteps. But the U.S. doesn’t import that much and so the impact of this action alone shouldn’t be too significant in the longer run.”

US Senator Edward Markey, Massachusetts:

“The time of lining Putin’s pockets by buying billions worth of Russian oil and petroleum is over. I am pleased to see that the White House has joined the bipartisan consensus in Congress to ban Russian oil imports. We need to make this ban permanent so that we can finally separate ourselves from the Russian oil funding the corruption and human rights abuses of the Putin regime.”

Lindsey Bell, chief markets & money strategist, Ally

“While direct imports of Russian oil are a small portion of the total imported by the U.S., the ban will continue to put pressure on the price of oil and thus pressure the consumer.

“The consumer is already feeling the pressure from inflation and that is likely to be again reflected in the consumer sentiment reading on Friday.”

Mike Tran, analyst, RBC Capital Markets

“A banning of U.S. imports from Russia would sharply reduce exports to South and Central America. This region typically feeds itself hand to mouth from U.S. Gulf exports.

“Disruption to the typical flow would lead to price on price competition for product with Europe, leading to a massive inflationary event for all regions involved.”

Goldman Sachs

“The U.S. only imports a little over 400,000 barrels per day from Russia at present (Dec-Feb average), already down from a peak of 770,000 bpd in May-June 2021. Volumes this small are well within the market’s ability to redirect flows and as such we would expect minimal overall impact on crude fundamentals.”


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