Oil prices have climbed back above 100 dollars a barrel and global stock markets continue to slump, as the US said it had temporarily loosened sanctions on Russian oil to “promote stability” in global energy markets.
The price of Brent crude oil was rising by about 0.5% on Friday morning to surpass the 100 dollar a barrel mark.
The International Energy Agency said on Thursday the flow of oil through the Strait of Hormuz had reduced to “a trickle” and it warned the war in Iran was causing the “largest supply disruption in the history of the global oil market”.
This was despite the 32-nation alliance agreeing to release a record 400 million barrels of reserves to help curb a potential supply shortage.
Meanwhile, US treasury secretary Scott Bessent said America was temporarily allowing “permit countries” to purchase Russian oil currently in transit, in a bid to “promote stability in global energy markets” and “keep prices low”.
He insisted the short-term measure would “not provide significant financial benefit to the Russian government”.
Mr Bessent also spoke about a 30-day waiver on Indian refiners who had been prevented from buying Russian oil.
“I think it’s an inevitability and that’s why we give a 30-day waiver because Russian barrels are on the water and it is a quick source for the Indian refineries,” he told Sky’s Wilfred Frost on the Master Investor Podcast.
“It is unfortunate and we hope that it will be a micro period that they will benefit.”
European stock markets were extending losses from Thursday, with the UK’s FTSE 100 down about 0.4% on Friday morning.
Germany’s Dax and France’s Cac were seeing deeper falls of about 0.9%.
It follows another day of losses on Wall Street, with the S&P 500 and Dow Jones indexes falling by about 1.5%.
The pound was also down by about 0.5% against the US dollar, at 1.327.
