Oil prices closed in positive territory on Monday amid concerns that supply could be curtailed by a possible European embargo on Russian oil.
In particular, Brent for July delivery added 44 cents or 0.4% to $ 107.58 a barrel, while US crude for June delivery WTI gained 48 cents or 0.5% and closed at $ 100.28 a barrel.
Both contracts lost more than $ 2 earlier in the day, following news that the Commission could exempt Hungary and Slovakia from the Russian oil embargo as the EU prepares to complete its next round of sanctions against Russia on Tuesday.
“Attention has quickly shifted to expectations that a full embargo is unlikely to take place for months and possibly by the end of the year, given that most countries need to find alternative sources of supply,” said Jim Ritterbusch, president of Ritterbusch and Associates in Gallena. .
The EU tends to ban imports of Russian oil by the end of the year, according to two EU diplomats, following talks between the Commission and EU member states over the weekend.
About half of Russia’s 4.7 million barrels per day of crude exports go to the EU, providing about a quarter of the bloc’s oil imports by 2020.
While Western countries have avoided buying Russian oil due to sanctions, the impact on global supply has eased somewhat as India has received Russian shipments at big discounts.
On the demand side, factory activity in the US grew at the slowest pace in nearly two years in April, according to a survey by the Institute for Supply Management (ISM) on Monday. However, the ISM factory activity index fell to 55.4 points last month.
“US financial data continues to show expansion in manufacturing, far from recessionary levels,” said Phil Flynn, a market analyst at Price Futures Group in Chicago.
China, meanwhile, released data on Saturday showing that factory activity in the world’s second-largest economy shrank for the second month in a row to its lowest level since February 2020 due to restrictive measures against the coronavirus pandemic.
On the supply side, the Libyan National Oil Company (NOC) said on Sunday it would temporarily resume work at the Zueitina oil terminal.
Source: Capital
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