Oil prices rose sharply in overnight trading, briefly touching $139 a barrel.
This is its highest level since July 2008.
It comes after Brent crude was trading at $128.6 a barrel, up 8.9 per cent over the session.
Before the invasion of Ukraine, Brent crude had been trading below $100 a barrel.
Mohamed El-Erian, chief economist at the insurer Allianz, said that it appeared likely that the new sanctions would be imposed given the continued bombardment of Ukrainian cities.
“It’s hard to see such sanctions not being imposed given the atrocities being committed against Ukraine,” he said on Twitter.
Bank of America chief economist Ethan Harris said cutting off most of Russia’s energy exports would be a “major shock to global markets”, adding that the loss of Russia’s 5m barrels could see oil prices double to $200 a barrel.
Mike Muller, of commodity trading firm Vitol, also said prices could rise further. “I don’t think we’ve priced in everything yet,” he said.
The rise in prices comes as talk of a ban on buying Russian oil are ongoing.
Antony Blinken, the US secretary of state, said yesterday that Washington was in “very active discussions with our European partners about banning the import of Russian oil to our countries”.