Oil prices rose above $100 a barrel after Russian President Vladimir Putin ordered a “special military operation” in the Donbass region of eastern Ukraine.
The price of a barrel of oil reached $103, the highest level in seven years.
Russia is the world’s second largest oil exporter and the largest natural gas exporter.
News of Ukraine’s military action affected global stock prices as Asian markets fell sharply.
On Tuesday, the Moscow Stock Exchange immediately halted trading after the ruble fell to its lowest level since 2016.
In response to the military action, EU leaders announced more sanctions against Russia.
The European Council said it would “impose severe and severe sanctions on Russia for what it did.”
The United States and the European Union had previously imposed sanctions on Russia over Putin’s actions against Ukraine.
Britain has frozen the assets of five Russian banks and three Russian billionaires and banned them from traveling.
Prime Minister Boris Johnson said on Tuesday it was the “first set of sanctions” that could be extended.
But strategic analyst Yi Junrong believes that “the steps taken by Russia prove that sanctions have no effect on preventing aggression.”
“With the Western reaction on the horizon, there is no indication that the situation will calm down,” he said.
The United States escalated pressure on Russia, imposing fines on Russian companies and their officials on the basis of Nord Stream 2 gas.
Nord Stream 2 extends 1,200 km under the Baltic Sea, and is designed to transport Russian gas to Europe via Germany.
Germany on Tuesday froze approval of the project, which was completed but not yet operational.