NEW YORK (TheStreet) -- The price of oil lost $7 of its value in the past three weeks. What has changed in the past few weeks to warrant such a sharp fall in prices? After all, the tensions in the Middle East remain high and the new sanctions that the West imposed on Russia could bring down the oil production of this country.
Will oil prices bounce back anytime soon?
Russia and Oil
The U.S and European Union recently imposed additional sanctions on Russia. Some of these sanctions could impede the future progress of Russia's oil production growth as they will include an "export ban for dual use goods for military end users and curtail Russian access to sensitive technologies particularly in the field of the oil sector."
Read More: 4 Stocks Warren Buffett is Selling in 2014
Thus, the ban on oil drilling equipment isn't likely to impede Russia from reaching its output of 10.55 million barrels of oil per day over the short term. Over the long term, however, this ban could reduce its growth in production.
But western oil companies such as Exxon Mobil (XOM) and BP plc (BP) could suffer because they have strong ties to the Russian oil market via Russian companies starting with Rosneft. BP owns 20% stake in the oil Russian producer, and Exxon Mobil is a partner with Rosneft in the Kara Sea project in north of Siberia.