Crude oil remains the most unpredictable commodity for traders, as the wild combination of mutually exclusive factors creates frameless pricing patterns. On one hand, Saudi Arabia signaled it believes oil demand in Asia and Europe is rising by lifting the price of most of the crude it supplies to the region. In response to that, while oil futures have softened slightly this year, many energy traders and executives are seeing prices surge – possibly as high as $100 a barrel – as China's economy recovers after other major economies lift coronavirus lockdowns and hints at unraveling inflation.

The biggest oil company in the world, Saudi Aramco, raised most official selling prices in Asia in April. The company's flagship product, Arab Light, was raised to $2.50 a barrel above the regional benchmark, up 50 cents from March.

On the other hand, when it comes to geopolitical oil price input, Kremlin spokesman Dmitry Peskov reiterated on Tuesday that Russia won't accept the price ceiling introduced on its oil by EU. Peskov told reporters that the country has taken measures that will safeguard against potentially dwindling margins, damaging Russia’s budget outlook and, as a result, sending the ruble exchange rate into a tailspin.

Indeed, more Russian crude is reportedly being shipped to the United Arab Emirates after the new round of sanctions, according to Reuters which cited ship-tracking data and trade sources pointing to ship-tracking data showing that as of November 2022, about 1.5 million barrels of Russian crude oil have been shipped to the United Arab Emirates, adding to its own inventories of the world's one of the largest oil producers. The first shipments of Russian crude to the United Arab Emirates were back in 2022, with shipments spiking in April.

Meanwhile, speaking at the CERAWeek energy conference, Chevron CEO Mike Wirth said that ships carrying Russian crude and products now have to travel over longer distances to reach non-sanctioned markets while oil inventories and swing supplies are limited, making the global market vulnerable to any unexpected supply disruption. He also said that gas markets are now more structurally changed for the long term than the oil market, noting that Europe has turned away from dependence on Russian gas supplies and has no intention of changing that in the future. Wirth said maintaining secure and affordable supplies while at the same time managing the energy transition to the low-carbon industry of the future was “one of the greatest challenges of all time.”

The major takeaway from these events is that instead of guessing on crude price predictions, commodity analysts must get more focused on the fact that the world oil and gas market is drastically reshaping, simultaneously threatening with tectonic shift of geographies of the total energy balance.