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The Key Takeaways
- The global benchmark oil futures have recently reached their highest level since last fall.
- A report that cited the possibility of increased U.S. Sanctions on Russia, which were announced later and likely fuelled demand fears. Oil prices could be affected by geopolitical and economic factors this year.
- The S&P 500's energy sector was its only advancer in recent trading.
The price of oil rose on Friday to levels not seen since the autumn, as traders digested additional U.S. Sanctions against Russia.
Brent crude futures, a global benchmark for oil, traded recently around $80. This is an increase of nearly 3% according to multiple market data sources. That was the contract's highest price since October. Meanwhile, the S&P 500's energy sector was the day’s only gainer of the index's 11, rising about 0.4%.
The Treasury Department on Friday announced actions targeting the Russian oil industry, including Russian oil producers Gazprom Neft and Surgutneftegas and sanctions on "more than 180 vessels, and dozens of oil traders, oilfield service providers, insurance companies, and energy officials."
'Ratcheting Up the Sanctions Risk'
"We are ratcheting up the sanctions risk associated with Russia's oil trade, including shipping and financial facilitation in support of Russia's oil exports," Treasury Secretary Janet Yellen said.
Reuters cited a story that said the action was likely. Futures rose earlier on Friday.
The cold weather that has been experienced in some parts of America could also have prompted traders to increase their demand for oil for heating.
Geopolitical issues—including sanctions and tariffs—are expected to be a key, if unpredictable, driver of movement in oil prices in 2025, Goldman Sachs analysts wrote Thursday, even as they forecast steady demand growth over the next decade, including from emerging markets.
UBS analyst wrote that reduced supply from Iran could increase prices in this year. A global economic slowdown, however, might cause them to fall.
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