Sanctions rhetoric escalates – Russia will respond “tick for tack”

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UPDATE: Prime Minister Johnson, speaking in Parliament, has indicated that UK sanctions will:

  • Exclude Russian banks from the UK financial system.
  • Complete the ability of Russian banks to access sterling or clear payments through the UK.
  • Impose an asset freeze against all major Russian banks, immediately.
  • Ban all major Russian companies from raising funding in the UK.
  • Limit deposits of Russian nationals in British banks.
  • Be extended to include Belarus.

It is unclear whether the Prime Minister’s sanctions will end the listing of Russian stocks on the London Stock Exchange, such as Rosneft (OTCPK: RNFTF) and gazprom (OTCPK:ogzpy) traded lower by 50% and 29%, respectively in London on Thursday. With Biden on deck to speak later on Thursday, markets will focus on any indication of sanctions related to the energy or SWIFT payment system.

Original:

Energy markets are laser-focused on events unfolding in Ukraine and the implications for fossil fuel prices. Until now, American and European allies have always been sent to the fact that the West will not prevent energy flows from Russia by sanction. So far, Russia has made no direct indication that it will restrict energy exports, although the rhetoric is heating up and gas flows from Russia to Europe remain around 50% below average. average over 5 years.

Moments ago, and according to RIA News, Russia’s Foreign Ministry said, “Russia will respond to EU and US sanctions in a tit-for-tat way.” This follows comments by former President Medvedev that Europeans should prepare for significantly higher natural gas prices.

(NYSARCA: USO) (NYSARCA:UNG) (Nysearca: to boil) (NYSARCA: XLE)

With Biden set to talk sanctions later on Thursday, the market will watch both White House comments and Russia’s response. Any indication that Russia will weaponize energy exports is sure to exacerbate energy security concerns in Europe and around the world.

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