WASHINGTON (DTN) -- Oil futures nearest delivery on the New York Mercantile Exchange and Brent crude traded on the Intercontinental Exchange powered higher in early morning trade Friday, although all petroleum contracts are on track for weekly losses after Russia excluded energy products from its sweeping ban on exports in a retaliatory response to escalating sanctions from the United States and the European Union, while the lack of progress in ceasefire talks between Russia and Ukraine continue to underpin price support for the oil complex.
The Russian government revealed a list of over 200 products that will fall under a temporary export ban to all countries, excluding member states of the Eurasian Economic Union, Abkhazia, and South Ossetia.
"This measure is necessary to maintain stability on the Russian market," the Russian government stated, adding the ban would be in effect until the end of 2022.
The list includes several types of timber, agricultural machinery, electric equipment, as well as railway cars and locomotives, containers, turbines, among others. However, there was no mention of a ban on energy exports -- a measure that was reportedly considered by several Russian officials.
Imports of Russian energy commodities are integral to the European economy, European oil refiners, and the continent's electricity generation. The EU is Russia's largest trading partner and accounts for nearly 40% of Russia's total global trade, with about half of Russia's oil exports and 70% of their natural gas exports going to Europe.
Markets breathed a sigh of relief after Russian President Vladimir Putin said on Thursday that Moscow would honor previous trade commitments and said there are no plans of seizing property from companies that left Russia over the past 14 days.
U.S. President Joe Biden is expected to announce on Friday the revocation of "most favored nation" status for Russia, an action that would allow new tariffs on Russian imports. Biden's expected announcement would put Moscow's trade relationship with the United States in the same category as North Korea and Cuba.
Escalating sanctions and tariffs on Russia, the world's second largest oil and gas producer, are raising costs for energy and food in the United States and Europe, accelerating already overheated inflationary pressure.
U.S. consumer price index surged 7.9% year-on-year in February -- the fourth straight month of inflation at a 40-year high. Nearly every category of goods and services got pricier. Gasoline costs jumped 6.6% last month and accounted for almost a third of the price hike. Grocery costs jumped 1.4%, the sharpest one-month increase since 1990 other than during a pandemic-induced price surge two years ago. The cost of fruits and vegetables rose 2.3%, the largest monthly increase since 2010.
In the European Union, where inflation hit 5.1% in February, the European Central Bank on Thursday said it would wind down some of its pandemic-era asset purchase program sooner than expected in response to price pressures.
"If the incoming data support the expectation that the medium-term inflation outlook will not weaken even after the end of our net asset purchases, the Governing Council will conclude net purchases under the APP in the third quarter," the ECB said Thursday.
The bank said monthly net purchases under the APP would amount to 40 billion euros ($44.5 billion) in April, 30 billion euros in May, and 20 billion euros in June.
The central bank's benchmark refinancing rate remains at 0%, the rate on its marginal lending facility sits at 0.25% and the rate on its deposit facility was kept at -0.5%.
Oil prices are also supported on Friday by a failed attempt to reach a ceasefire agreement between Russian and the Ukraine, with both sides making little progress at stopping the heavy fighting around Ukraine's largest cities. Satellite imaginary showed that a 40-mile convoy of vehicles, tanks and artillery surrounding Kyiv has been broken up and redeployed. Moscow also widened its military offensive on Friday, striking near Ukrainian airports in the west for the first time since the beginning of the invasion on Feb. 24.
Near 7:15 a.m. ET, NYMEX April West Texas Intermediate advanced $1.68 to $107.69 per barrel, and ICE Brent May contract gained $1.89 to $111.22 per barrel. NYMEX April RBOB futures surged 10.28 cents to $3.2606 gallon, and April ULSD futures gained 9.80 cents to $3.3979 gallon.
Liubov Georges can be reached at firstname.lastname@example.org