Ukraine crisis: Crude oil prices jump, Russian ruble falls to record low

Crude oil jumped as the ruble plunged nearly 30% to a new record high on Monday after Western countries imposed new sanctions on Russia for its invasion of Ukraine, including blocking some banks in the SWIFT international payment system.

Demand for safe haven pushed bond yields higher, along with the dollar and yen, while the euro tumbled after Russian President Vladimir Putin put nuclear forces on high alert on Sunday, the fourth day of the most major assault on a European state since World War II.

Rising tensions have heightened fears that oil supplies from the world’s second-largest producer could be disrupted, pushing Brent crude LCOc1 futures up $4.21 or 4.3% to $102.14 . US West Texas Intermediate (WTI) crude futures CLc1 rose $4.58 or 5.0% to $96.17 a barrel.

U.S. and European stock futures fell, but Asia-Pacific stocks were mostly higher in volatile trading, buoyed by Wall Street gains from Friday, when the S&P 500 closed in up 2.51%, said Kyle Rodda, market analyst at IG Australia.

“We had a deluge of very negative information this weekend,” Rodda said. “My feeling is that there won’t be much resistance behind this particular move (in Asia-Pacific equities), given that we’re talking about financial stability risks, and sprinkling on top of that the threat of nuclear war.”

“Volatility is heightened,” he said. “Price action is incredibly choppy.”

U.S. emini stock futures were pointing down 1.57% on the restart, while pan-European EURO STOXX 50 STXEc1 futures lost 2.83%.

Japan’s Nikkei 225 rose 0.48%, recovering from an earlier loss. Australia’s benchmark index gained 0.64% after also falling at one point. Chinese blue chips, however, slipped 0.21%.

The MSCI Regional Equity Index gained 0.09%.

Meanwhile, the 10-year US Treasury yield fell around 6 basis points to 1.92%, and equivalent Australian yields were also down around 6 basis points to 2.18%.

The euro slipped 0.9% to $1.1170 and 0.87% to 129.065 yen, while the risk-sensitive Australian and New Zealand dollars fell 0.66% and 0.76%, respectively.

The ruble fell 29.37% to a record high of 119 to the dollar.

Steve R. Hansen