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Asian shares hit oil prices surge with Ukraine-Russia tensions

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Hong Kong: Asian markets mostly fell on Monday as growing fears of a conflict between Ukraine and Russia sent traders scurrying for safer assets, with the yen surging and oil prices also seeing big gains.

New York’s main contract, West Texas Intermediate (WTI) for April delivery, gained $1.14 to $103.73 in afternoon trade, and Brent North Sea crude for April jumped $1.62 to $110.69.

Desmond Chua, market analyst at CMC Markets in Singapore, said that the escalating tension in Ukraine was providing strong support for oil prices. “Considering that Ukraine is part of the supply chain for Brent, we are looking at this pent-up risk premium resulting in overshooting prices,” Chua told AFP.

JP Morgan Commodities Research analysts noted that Ukraine is neither a major oil producer nor oil consumer but said it is an important transit country for Russian energy exports. More than 70% of Russia’s gas and oil flows to Europe pass through its territory. In turn, Europe is the buyer for nearly 90% of Russia’s oil exports.

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