WTI loses ground on the delay of an EU embargo on Russian oil

• WTI has slipped near $111.00 as the EU holds confirmation on banning Russian oil.
• Germany and Belgium are notwithstanding the EU’s decision of the embargo on Russian oil.
• An immediate ban on Russian oil will have a devastating impact on the European economy.

West Texas Intermediate (WTI), futures on NYMEX, has witnessed a steep fall after sensing significant offers near $116.00. The oil prices have slipped in the absence of confirmation on banning Russian oil by the European Union (EU).

EU leaders summit on prohibiting oil from Moscow didn’t reach any outcome on Thursday. A mixed response was witnessed from the EU members on dropping Russia from their oil importers list. Russia addresses 45% of EU gas imports, 25% of oil imports, and 45% of coal, which indicates their extreme dependency. Some of the EU players have a higher dependency on Russian fossil fuels than the average. Germany fetches more than half of its gas imports from Moscow. Should Germany drops Russia as a gas exporter the former will face escalation in unemployment and a serious drop in manufacturing activities.

Also, Belgium’s prime minister, Alexander De Croo, has supported Germany while stating that an oil embargo “would have a devastating effect on the European economy and I don’t think it’s necessary”.

An immediate ban on Russian oil might be an optimal idea to hurt the Russian economy but not a fair decision for the European economy.

Meanwhile, the US dollar index (DXY) is scaling towards 99.00 on the healthy performance of their economic indications. The weekly Initial Jobless Claims and monthly Markit PMI numbers have outperformed their market estimates and previous prints. This has also raised bets for a 50 basis point (bps) interest rate hike by the Federal Reserve (Fed) in May monetary policy.