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ICE Brent fell more than 13% on March 9, 2022, to near $111 a barrel, as Ukrainian government comments about willingness to compromise to end the war triggered a broad sell-off in Russia-exposed commodities. The EIA reported US crude inventories fell 4.39 million barrels, with distillate stocks down 5.23 million barrels, and reports of UAE comments on OPEC+ output added to the volatility.
Oil prices are highly sensitive to Russia-Ukraine headlines, so energy and freight costs for feed can swing sharply on peace or escalation news. Falling distillate stocks partly offset the price drop and keep diesel costs elevated.
think.ing.comWarren PattersonMar 10, 2022After 250 past bearish geopolitics events, Crude Oil (Brent) moved a median -3.1% over 5 sessions (36% higher; middle half -7.9% to +1.6%), and -5.5% over 20.
After 255 past bearish geopolitics events, Crude Oil (WTI) moved a median -2.4% over 5 sessions (31% higher; middle half -7.0% to +1.7%), and -5.0% over 20.
After 51 past bearish geopolitics events, ULSD / Diesel moved a median -2.4% over 5 sessions (37% higher; middle half -8.2% to +3.9%), and -2.3% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
Links the Brent sell-off to Ukrainian willingness to compromise, which cut the war risk premium, plus the UAE OPEC+ comments.
Ukrainian willingness to compromise triggered a broad sell-off in Russia-exposed commodities, cutting the geopolitical risk premium.
