Oil prices go up with news of EU proposal for 6th sanction on Russia

Oil prices modestly went down this week – Php 1.15 per liter for diesel and Php 0.65 per liter for gasoline – but next week might be a totally different story.

According to the most recent predictions of PH Fuel Watch, next week might see another round of oil price increase estimated at around PHP 3.43 per liter of diesel, and PHP 3.38 per liter of gasoline. The reason? It's because of the proposed ban on Russian oil in Europe.

Proposed EU sanction vs. Russia raises oil prices image

Yesterday, the European Union (EU) revealed a proposal to implement a complete import ban on Russian oil within six months, including crude and refined products.

Though still a proposal, there was a profound impact on oil prices today. Various news agencies report a 5.3% increase in the price of West Texas Intermediate, while Brent crude went up by 4.9%.

The proposal will need the support of all 27 EU members before it is approved, and so far, Hungary, Slovakia, Bulgaria, and the Czech Republic have yet to be convinced.

Australia, the United States of America, and the United Kingdom have already implemented an oil embargo to cut Russia's revenue stream and its ability to finance its war versus Ukraine.

If the proposal is authorized and Russian oil and its byproducts are banned, EU member nations must source their daily requirement of some 3.5 million barrels of oil for other countries. That is why oil prices are so jumpy at the news of the EU plan.

Without the western market, experts predict that Russia must now scale down oil production as it will run out of storage.

The EU’s proposal is part of the sixth set of sanctions against Russia. It has already had an effect on global prices. PH Fuel Watch already predicts a price increase, but let's wait and see if there would be a change of tune in local gas, diesel, and kerosene prices next week.