Bloomberg reported that Russia's war on Ukraine and the resulting violent international reactions have plunged global energy markets into chaos.
Which portends dire economic consequences comparable to those caused by the oil shocks of the seventies of the last century.
The site stated that coal achieved an unprecedented price recovery by nearly 80%, European gas prices broke the record, and oil futures fluctuated in the widest range of exchange in 3 decades.
"You can't stop the world's second largest crude oil producer [from exporting] without expecting bad things to happen," says Jeff Currie, director of commodity research at Goldman Sachs Group.
According to Bloomberg, the sudden economic isolation imposed on Russia deprives the world of a major global source of energy, minerals and agricultural crops, which threatens the foundations of the state itself and raises fears of something that developed countries did not suffer in decades past, such as severe inflation and a real energy shortage.
Most European countries still depend on Russia for more than half of their crude oil imports.
And Bloomberg quotes Daniel Yergin, an oil and gas historian and vice president of IHS Markit Ltd., as saying that the process that began in the 1990s to connect Russia and integrate it into the global economy “is going very quickly in the opposite direction.” .
The result was chaos in the energy market, as Bloomberg put it;
This is due to the inability to obtain insurance for imports or oil tankers and caused by the effective boycott of millions of Russian barrels of oil per day.
And it's not just oil. Wheat prices jumped to their highest level since 2008, and topped $550 a ton in Paris this month, after the war in Ukraine halted nearly a quarter of global exports.
The price of aluminum also hit a record, and exceeded $ 3,800 per ton on the London Metal Exchange, before declining later, and copper approached its highest levels ever.
Henning Gloustein, an analyst with the Eurasia Consulting Group for Political Risk, confirms that the world has never witnessed a sudden rise in commodity prices with this sharpness, adding that unless there is a significant reduction in the escalation of conditions, the record or high prices of many commodities due to sanctions and disrupted supply chains will continue.
The decline in Russian oil exports may eventually resemble the collapse that afflicted Iran during the period between 1978 and 1979 when the oil sector was suffering from double pressures represented in the popular revolution internally and the freezing of state assets by the US government, as Jeff Corey of Goldman Sachs believes. .
International efforts to tame the confusion that prevail in the markets have failed - in Bloomberg's opinion - which has created a precarious situation, especially for US President Joe Biden ahead of the mid-term congressional elections in light of his low popularity.
Megan O'Sullivan, professor of international affairs at Harvard Kennedy School, predicts that the Russian energy crisis will reverberate around the world for years to come.