TOKYO (AP) — The price of oil jumped about $10 a barrel and stocks plummeted on Monday as the conflict in Ukraine deepened amid growing calls for tougher sanctions against Russia.
Brent crude was up more than 12% on the day in Asia, while US benchmark rose by about $10 at over $125 a barrel.
The latest market turmoil follows Russian President Vladimir Putin’s warning that Ukrainian statehood is under threat as Russian troops attack strategic targets. A temporary ceasefire in two Ukrainian cities over the weekend failed – and both sides blamed each other.
The French CAC 40 fell 3.6% in early trading to 5,841.82 points, while the German DAX lost almost 4.1% to 12,564.78 points. The British FTSE 100 fell 2.0% to 6848.87. US stocks should have been lower, with Dow futures down 1.6% to 33,048.00. S&P 500 futures fell 1.7% to 4252.00.
Considered a safe haven for investors during the crisis, the price of gold jumped $26 an ounce to $1992.90.
Oil prices came under additional pressure after Libya’s national oil company said an armed group had closed two important oil fields. The move caused the country’s daily oil production to drop by 330,000 tons.
US House Speaker Nancy Pelosi said the House of Representatives is studying legislation to further isolate Russia from the global economy, including a ban on its oil and energy imports to the US.
Brent crude, the international pricing standard, reached $139.13 a barrel before falling. In London, it traded up $9.22 to $127.33 a barrel.
US crude rose $9.70 to $125.38 a barrel in electronic trading on the New York Mercantile Exchange. Its all-time high was recorded in July 2008, when the price per barrel of American oil rose to $145.29.
This caused the average price of regular gasoline in the US to rise nearly 41 cents from $4 a gallon (3.8 liters) on average for the first time since 2008, according to the AAA Automobile Club.
The all-time high for average gasoline prices was set on July 17, 2008 at $4.10 per gallon.
Higher fuel costs are devastating for Japan, which imports almost all of its energy. Japan’s benchmark Nikkei 225 fell 2.9% to 25,221.41.
The Hong Kong Hang Seng fell 3.9% to 21,057.63 and the South Korean Kospi fell 2.3% to 2,651.31. The Australian S&P/ASX 200 shed 1.0% to hit 7038.60. Shanghai Composite shed 2.2% to 3372.86 points.
“The conflict between Ukraine and Russia will continue to dominate market sentiment and the lack of signs of conflict resolution for now is likely to limit risk appetite into the new week,” said Yip Jun Rong, market strategist at IG in Singapore.
“By now, it should be clear that economic sanctions will not deter any Russian aggression, but rather serve as a punitive measure by affecting global economic growth. Rising oil prices could jeopardize company margins and consumer spending prospects,” Yep said.
China reported on Monday that its exports rose by double digits in January and February before Russia’s attack on Ukraine rocked the global economy.
Customs data shows that exports are up 16.3% year-over-year, signaling a recovery in global demand before President Vladimir Putin’s Feb. 24 invasion. Imports rose 15.5% despite a Chinese economic slowdown that the war could exacerbate.
China’s No. 2 leader, Prime Minister Li Keqiang, warned on Saturday that global conditions are “unstable, grave and uncertain” and “hard efforts” will be needed to achieve Beijing’s economic goals.
Markets around the world have been rocking lately on fears about how high prices for oil, wheat and other commodities produced in the region will fall due to Russia’s invasion, stoking already high global inflation.
The list of companies leaving Russia has expanded to include Mastercard, Visa and American Express, as well as Netflix.
The conflict in Ukraine also threatens food supplies to some regions, including Europe, Africa and Asia, which depend on the vast, fertile farmlands of the Black Sea region, known as the “breadbasket of the world.”
In foreign exchange trading, the US dollar rose to 115.03 Japanese yen from 114.86 yen. The euro was worth $1.0872, down from $1.0926.
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AP Business correspondents Joe McDonald from Beijing and Elaine Kurtenbach from Bangkok contributed.