Oil price jumps $10 a barrel

TOKYO - The price of oil jumped about $10 a barrel as the conflict in Ukraine deepened amid mounting calls for harsher sanctions against Russia.

Brent crude oil surged more than 12% during the day in Asia, while benchmark US crude gained about $10 at more than $125 a barrel.

The latest market turmoil followed a warning from Russian President Vladimir Putin that Ukrainian statehood was imperiled as Russian forces battered strategic locations. A temporary cease-fire in two Ukrainian cities failed over the weekend — and both sides blamed each other.

Oil prices came under additional pressure after Libya’s national oil company said an armed group had shut down two crucial oil fields. The move caused the country’s daily oil output to drop by 330,000.

US House of Representatives Speaker Nancy Pelosi said the House was exploring legislation to further isolate Russia from the global economy, including banning the import of its oil and energy products into the US

Brent crude, the international pricing standard, hit $139.13 per barrel before falling back. It was trading up $9.22 at $127.33 a barrel in London.

US crude soared $9.70 to $125.38 a barrel in electronic trading on the New York Mercantile Exchange. Its all-time high was marked in July 2008, when the price per barrel of US crude climbed to $145.29.

That pushed the average price for regular gasoline in the US up almost 41 cents past $4 per gallon (3.8 liters) on average for the first time since 2008, according to the AAA motor club.

The all-time high for average gasoline prices was set July 17, 2008 at $4.10 per gallon.

Higher fuel costs are devastating for Japan, which imports almost all its energy. Japan’s benchmark Nikkei 225 dipped 2.9% to finish at 25,221.41.

Hong Kong’s Hang Seng dropped 3.9% to 21,057.63, while South Korea’s Kospi slipped 2.3% to 2,651.31. Australia’s S&P/ASX 200 shed 1.0% to 7,038.60. The Shanghai Composite lost 2.2% to 3,372.86.

“The Ukraine-Russia conflict will continue to dominate market sentiments and no signs of conflict resolution thus far may likely put a cap on risk sentiments into the new week,” said Yeap Jun Rong, market strategist at IG in Singapore.

“It should be clear by now that economic sanctions will not deter any aggression from the Russians, but will serve more as a punitive measure at the expense of implication on global economic growth. Elevated oil prices may pose a threat to firms’ margins and consumer spending outlook," Yeap said.