Oil prices 'hitting new highs' - Frankfurt traders react to market uncertainty amid Ukraine crisis

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Stockbrokers reacted to the uncertainty on the German markets from Frankfurt on Tuesday after fuel prices skyrocketed following Russia’s deployment of peacekeeping forces to the self-proclaimed Lugansk and Donetsk Peoples’ Republics.

With Berlin threatening to delay the Nord Stream 2 pipeline following Moscow’s recognition of the breakaway regions, Arthur Brunner, a financial expert at Frankfurt’s ICF Bank, explained that the oil prices were ‘hitting new highs’.

“It has increased another 50 percent since the beginning of December. The price for gas increased as well,” said the trader, the reason being Russia’s status as the world’s second biggest oil producer.
He added that it would be difficult for Europe to get along without Russian oil and gas: “We clearly count on the Russian supply a lot. So far Russia has always been reliable. That’s why an agreement should be found.”

He said the German economy hadn’t been hit too hard yet, but he was certain the markets would be, stating that consumers would also “feel it when they get the invoice for their heating, either for gas or oil.”

He added that a ban on Nord Stream 2 would be “hit us hard” because gas prices would increase even more. “That’s why such a scenario should be avoided… but it’s a pity that we had to get to this point,” he said.

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SOT, Arthur Brunner, German trader (German): “The price of oil is hitting new highs. It has increased another 50 percent since the beginning of December. The price for gas increased as well. The main reason is basically that Russia is the second biggest global oil producer.”

SOT, Arthur Brunner, German trader (German): “I think it would be difficult for Europe to get along without Russian oil and gas. We clearly count on the Russian supply a lot. So far Russia has always been reliable. That’s why an agreement should be found.”

SOT, Arthur Brunner, German trader (German): “It doesn’t hit the German economy too hard at the moment but surely the markets will be. Consumers will also feel it when they get the invoice for their heating, either for gas or oil. It also leads to less purchasing power. Everyone who is driving a car can clearly notice at the petrol station how severe the effects of the current situation are.”

SOT, Arthur Brunner, German trader (German): “I personally think Putin has now taken that position to have a stronger basis for negotiation. But of course he is keeping up the threat to go to the limits if necessary, in case he should not receive an answer or be further ignored.”

SOT, Arthur Brunner, German trader (German): “I think diplomacy is still better than choosing the hard way because I don’t think Russia would be too impressed by the threats from NATO. There would be further escalations and possibly other new conflicts as a result instead. That’s why I think diplomacy is the best choice.”

SOT, Arthur Brunner, German trader (German): “In my personal view the ban of Nord Stream 2 would be a hard hit to us because the gas prices would increase even more. Many apartment owners and renters had to find out how severe these effects of the gas prices can be. That’s why such a scenario should be avoided. Right now it is a possible political instrument. But it’s a pity that we had to get to this point.”

#Germany #Frankfurt #stockbrokers

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