Brent oil prices peaked at nearly $120 per barrel as another energy crisis looms

The Iran war has shown that EU sanctions on Russian energy were "strategic blunders," as oil prices have crossed $100 a barrel for the first time since 2022, Kirill Dmitriev, an investment envoy to President Vladimir Putin, has said.

In a series of posts on X from Sunday to Monday, Dmitriev commented on the rise in oil prices by around 50% since the start of the US-Israeli strikes on Iran last month. In one of the messages, he mocked the EU policymakers over what he described as a short-sighted policy of sanctioning Russia over the Ukraine conflict.

"Bingo - welcome to $100+ oil. Most thought impossible - predicted $100+ in June. Now, as most EU bureaucrats still don't grasp consequences, predict Russian energy vital for survival & strategic blunders of restricting it will be fully exposed. Diversify to survive," he said.

As the Brent prices peaked at almost $120 per barrel, Dmitriev noted that "$150+ is the new oil target, with even $200+ a possibility in a prolonged conflict." He went on to explain that "the oil issue is no longer just about the Strait of Hormuz," but also attacks on oil and gas infrastructure across the Middle East.

The oil rally was somewhat mitigated by reports that G7 countries are discussing a coordinated release of oil from their strategic reserves.

The US-Israeli strikes on Iran, which triggered Tehran's retaliation, significantly raised the risks for vessels passing through the Strait of Hormuz - a key artery for around 20% of global oil consumption. Maritime traffic through the waterway collapsed by an estimated 80% as several oil tankers were hit in the area.

The EU faced a similar price shock when it sanctioned Russia following the escalation of the Ukraine conflict in 2022, with Brent crude averaging $100 per barrel throughout the year. Despite the ensuing energy crisis and heavy burden on consumers, the EU vowed to wean itself off Russian fossil fuel by the end of 2027.

US President Donald Trump brushed off the ongoing price surge on Sunday, saying higher oil costs caused by the Iran war are "a very small price to pay for U.S.A., and World, Safety and Peace."