Oil prices are on the rise at today’s meeting amid falling supply and heightened prospects for new Western sanctions on Russia, even after signs of progress emerged from peace talks between Moscow and Kiev.
Brent futures traded up immediately at $ 112.78 a barrel and rose 86 cents, or 0.8%, to $ 111.09, reversing the 2% loss yesterday.
US West Texas Intermediate rose 82 cents, or 0m8%, to $ 105.6 a barrel, after falling 1.6% on Tuesday.
“Fluctuating prices show an extremely sensitive climate among investors,” said Haitong Futures analysts. “People urgently need to see changes to make the market clearer.”
The focus is now on reduced supplies, as the American Petroleum Institute announced that crude stockpiles fell by 3 million barrels a week through March 25.
The drop was three times what analysts had expected
The market experienced a sharp selloff in the previous session, after Russia promised to reduce military operations near Kiev, but the attacks continue, according to reports.
Commonwealth Bank analyst Tobin Gorey says the price recovery suggests that the oil market, at least, has a strong degree of skepticism about any “progress.”
Meanwhile, the United States and its allies are planning new sanctions on several sectors of the Russian economy that are critical to sustaining its invasion of Ukraine, including military supply chains.
Keeping the market “tight”, major oil producers are unlikely to increase production beyond the agreed 400,000 barrels per day when OPEC + meets on Thursday.
Source: Capital
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