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Boris Johnson says Russia has chosen ‘path of destruction’ after Putin launches ‘military operation’ in Ukraine
The price of oil has jumped to a seven-year high to nearly $105 (￡78) following Russia’s invasion of Ukraine.
Brent crude is 6.6 per cent higher at $103.21 a barrel, the highest since August 2014, while US light crude has jumped 6.2 per cent to $97.75 a barrel.
Gas prices are also on the rise, up by 40 per cent, amid fears that the conflict will disrupt global supply chains.
Wall Street fell sharply at the opening on Thursday following the Russian invasion of Ukraine.
The Dow Jones Industrial Average plunged more than 800 points or approximately 2.5 per cent.
Panicked investors fled for the safety of fixed income assets as markets reacted to the worst case geopolitical scenario on the back of the impact of sky-high inflation.
In London, the FTSE 100 index plunged more than 200 points, or 2.7 per cent, upon opening on Thursday in reaction to Russia’s invasion of Ukraine, which US President Joe Biden described as “unprovoked and unjustified”.
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Key Points Markets rocked by Russian invasion of Ukraine Russia stock market crashes after dawn air raids RAC warns petrol prices could soar to ￡1.60
Show latest update 1645720839 ICYMI: Warning over petrol prices hitting ￡1.60 a litre as Russia invades Ukraine
Motorists are being warned over the possibility of petrol prices soaring to ￡1.60 a litre following Russia’s invasion of Ukraine.
The price of Brent crude oil hit its highest level in eight years after increasing by 6.3% to 102.90 US dollars per barrel shortly after 8am on Thursday.
Average fuel prices at UK forecourts are already at record highs, and the situation is expected to worsen as retailers pass on further rises in wholesale costs.
Matt Mathers 24 February 2022 16:40
1645719339 Boris Johnson: We must wean ourselves off Russian oil
Boris Johnson is rallying European leaders to sever the dependence on Russian oil that has given Vladimir Putin a "grip" on western politics in the wake of the invasion of Ukraine.
The prime minister was working with allies on Thursday to create a "massive" package of sanctions that will "hobble the Russia economy".
“Today, in concert with our allies, we will agree a massive package of economic sanctions designed in time to hobble the Russian economy.
“And to that end, we must also collectively cease the dependence on Russian oil and gas that for too long has given Putin his grip on Western politics.”
Matt Mathers 24 February 2022 16:15
1645718549 Bank of Russia intervenes to prop up faltering rouble
Russia’s central bank said it would intervene in currency markets to prop up the faltering rouble, which crashed to an all-time low of 89.60 against the US dollar after Putin launched a full-scale invasion.
The bank said: “To stabilise the situation on the financial market, the Bank of Russia decided to start interventions on the currency market.
“The bank has also decided to expand the list of securities it accepts as collateral in exchange for liquidity it provides, and will hold operations to offer extra liquidity to the Russian banking sector.”
Matt Mathers 24 February 2022 16:02
1645716637 Food prices set to rise and inflation could hit 8.2% due to invasion
The government said it will monitor and offer support as required if the full-scale invasion of Ukraine by Russia leads to a surge in global food prices.
Ukraine is a major supplier of wheat and corn, with economists warning the cost-of-living crisis in the UK could be exacerbated with inflation rising well beyond current predictions of around 7% later this year.
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said if the jumps in oil, gas and electricity products on Thursday are sustained, it could push inflation to 8.2% in April.
It would only fall back to 6.5% by the end of the year, he added.
Inflation hit 5.5% in January and the Bank of England believes it will peak at more than 7% in April when huge 50% increases in domestic energy bills when the new price cap hits.
Mr Tombs said: "Today’s surge in oil, natural gas and electricity prices, if sustained, points to an extra 1.5pp boost to the UK CPI.
"CPI inflation now likely to peak at circa 8.2% in April and only come down to 6.5% by the end of the year.
"Hard to see how households’ real spending keeps rising."
Matt Mathers 24 February 2022 15:30
1645715262 Conflict could hit UK seasonal workforce
Ukrainians made up two-thirds of the UK’s seasonal workforce last year - prompting questions over how the conflict might affect recruitment on British farms.
A total of 19,920 seasonal worker visas were issued to Ukrainian nationals in 2021, 67% of the total, according to Home Office immigration figures.
The equivalent number for Russian nationals is 2,278, or 8%.
The Migration Observatory at the University of Oxford said the figures raise "questions about the potential impact of conflict in Ukraine on recruitment to British farms, as the security situation in the nation deteriorates".
Ukrainians were the second most common nationality among people granted UK work visas in 2021, almost exclusively as a result of the seasonal worker visa, according to the Observatory.
Director Madeleine Sumption said: "For most of the past 15 years, the majority of work migrants coming to the UK were from EU countries. Since the end of EU free movement, the large majority now come from non-EU countries.
"Today’s data show how heavily UK farms have relied on Ukrainian workers in particular, raising the question whether this source of workers will be disrupted by unpredictable events in that region."
Matt Mathers 24 February 2022 15:07
1645714751 Ukraine crisis: Wall Street plunges on opening as Russian invasion rattles markets
Wall Street fell sharply at the opening on Thursday following the Russian invasion of Ukraine.
The Dow Jones Industrial Average plunged more than 800 points or approximately 2.5 per cent.
Panicked investors fled for the safety of fixed income assets as markets reacted to the worst case geopolitical scenario on the back of the impact of sky-high inflation.
My colleague Oliver O’Connell will have more on this story as it comes in:
Wall Street plunges as Russia invades Ukraine Wall Street fell sharply at the opening on Thursday following the Russian invasion of Ukraine.
Matt Mathers 24 February 2022 14:59
1645712691 Russian rouble and Turkish lira vulnerable
More reaction from the city.
Cristian Maggio, head of strategy at TD securities, London said: “Currencies that will underperform the most are the most volatile - the Russian rouble and the Turkish lira.
"For the rouble and not to mention the Ukrainian currency the other risk is that liquidity simply drags out. Investors will not want to be involved at all.
"What’s going to happen, only Putin knows. As usual, Russian sources denied any intention to be militarily involved in Ukraine and here we are, in the largest-scale military operation in Europe since World War Two. Anything can happen from here.
"The safe-haven bid is exactly what is happening."
Matt Mathers 24 February 2022 14:24
1645710347 Commodity prices soar
Russia’s attack on Ukraine roiled global markets Thursday, driving up prices for crude oil and natural gas as investors flood into gold and government debt – traditional safe havens.
Brent crude, the global oil-price benchmark hit $102, topping $100 a barrel for the first time since 2014. Analysts warned on Wednesday that a full-scale attack on Ukraine from Russia could rapidly drive prices well above ￡1.50 a litre at the pump for British consumers.
Our economics editor Anna Isaac reports:
Russian attack on Ukraine hits global markets Oil prices reached highest level in seven years following explosions in Ukraine, as investors fled to traditional safe havens
Matt Mathers 24 February 2022 13:45
1645709447 ICYMI: Oil prices surge past $100 a barrel as Putin declares war on Ukraine
Oil prices have topped more than $100 a barrel for the first time since 2014 after Vladimir Putin announced a Russian invasion of Ukraine.
Brent crude reached highs of $102.48 on Thursday morning, rising by more than 5 per cent as reports of explosions in Kiev and other major cities in the country filtered across the globe.
Russia is the world’s second-largest oil producer and conflict and is a major supplier to Europe. It is also the largest supplier of natural gas to the continent.
My colleague Eleanor Sly has more details below:
Oil prices surge past $100 a barrel as Putin declares war on Ukraine Markets plunge after Moscow announces military action against Kiev
Matt Mathers 24 February 2022 13:30
1645707280 Market reaction has gone ‘by the playbook’
Reaction from Seema Shah, chief global strategist, principal global investors, London:
“The market reaction has gone by the playbook.”
“Typically with geopolitical events, the response lasts for a while and then the focus shifts to the economic backdrop.”
“We think this is a short-lived rout and markets will come back.”
Matt Mathers 24 February 2022 12:54
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