Brent Crude’s Premium to WTI Expands Amid Escalation of Tension in Ukraine

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Brent Crude’s Premium to WTI Expands Amid Escalation of Tension in Ukraine

Brent crude advanced on worry that rising tensions in Ukraine may obstruct global shipments. WTI also soared after a US jobs report showed payrolls improved in April by the most in two years.

Brent added for the first time in three days, surging 0.8%. Ukraine moved on pro-separatists in bid to retake Slovyansk. The move was in defiance of President Vladimir Putin, who had asked Ukrainian army to retreat.

Russia holds Ukraine responsible for the on-going bloodshed.

As Bloomberg reports, WTI eased weekly losses as the jobless rate declined to 6.3% in April, the lowest since September 2008.

“Ukraine is engaging in a big military way and Brent is having greater value due to geopolitical influences of Ukraine. The unemployment number is construed positively for increases in petroleum demand,” said Tom Finlon of Energy Analytics Group LLC in Florida.

The per barrel price of June settlement Brent advanced 83 cents at close after hitting $108.59 on the ICE Futures Europe exchange in London. All the futures traded at 4.9% above the 100-day average. Prices fell 0.9% since April 25.

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June settlement WTI added 34 cents or 0.3% to close at $99.76 per barrel on the New York Mercantile Exchange. The amount of futures traded was lower than the 100-day average by 12%. Prices slid 0.8% for this week. The European measure was at a premium of $8.83 per barrel, in comparison with $8.34 on Thursday.

According to BusinessDay, the US and Europe have threatened more measures against Russia, which is being accused of stoking unrest in Ukraine by aiding separatist groups. But the sanctions have not touched on Russia’s natural gas or oil industries.

Russia’s energy minister said that gas giant Gazprom would cut shipments to Ukraine in June if it would not be paid by this month.

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To contact the reporter of this story; Jonathan Millet at john@forexminute.com