Models of oil barrels and a pump jack are displayed in front of a rising stock graph and “$100” in this illustration taken February 24, 2022. REUTERS/Dado Ruvic/Illustration
February 24, 2022
By Nina Chestney, Nigel Hunt and Pratima Desai
LONDON (Reuters) – Global commodity prices jumped towards multi-year highs on Thursday as Russia launched a full scale invasion of Ukraine, with prices responding in knee-jerk fashion despite steady export flows of Russian oil, gas, grains and metals to the West.
Oil prices rose above $100 per barrel for the first time since 2014, UK and Dutch gas prices rose 30%-40% and wheat futures in Chicago jumped to a 9-1/2 year high. [NG/EU]
Russia supplies 10% of global oil, a third of Europe’s gas and, together with Ukraine accounts for 29% of global wheat exports and 80% of sunoil and 19% of maize exports.
Russia is also a major alluminium, nickel, platinum, palladium, uranium, titanium, coal, timber and fertilisers producer.
Key commodities jump higher on Thursday after Russia launches a full invasion of Ukraine – https://fingfx.thomsonreuters.com/gfx/ce/dwvkrlrwmpm/CommoditiesJumponRussia.png
The country supplies significant volumes of gas to Europe via Ukraine, mainly to countries such as Austria, Italy and Slovakia as well as Germany and Poland although the latter get most of their Russian gas via other routes.
Russia launched an all-out invasion of Ukraine by land, air and sea on Thursday, the biggest attack by one state against another in Europe since World War Two.
Russia’s state gas pipeline monopoly Gazprom said supplies through Ukraine were as normal and Ukraine said its energy infrastructure has not been damaged. Austria also said it was receiving normal gas deliveries.
At least ten oil traders with trading houses and Western oil majors said there have been no interruptions to Russian oil flows including via the Black Sea.
Russia, Kazakhstan, Azerbaijan and Turkmenistan ship some 2-3 million barrels per day or 2-3% of global supplies to markets via the Black Sea.
Turkey, a member of the NATO Western military alliance, has control over the Bosporus that connects the Black and Mediterranean Seas.
The movement of vessels on the Azov Sea was suspended on Thursday although ports in the Black Sea, which account for most grain and oilseed exports, remained open.
Worries about aluminium supplies from Russia have propelled aluminium to a record high of $3,449 a tonne a gain of 21% so far this year.
Rusal the world’s largest aluminium producer outside China produced 3.8 million tonnes of aluminium in 2021, about 6% of the estimated world production.
CBOT corn futures were also up by their daily trading limit of 35 cents per lb at $7.16-1/4 a bushel – the highest level since June 2021.
(Writing by Dmitry Zhdannikov; Editing by Veronica Brown and Barbara Lewis)
Source: One America News Network
