Crude oil prices rose on Wednesday with Brent rising above $90 a barrel for the first time in seven years amid tensions between Russia and the West.
see photosCrude oil inventories rose 2.4 million barrels last week, the Energy Information Administration (EIA) said
Oil rose above a seven-year high of $90 a barrel on Thursday as the Ukraine crisis signaled that the US Federal Reserve would tighten monetary policy. Brent crude futures were up 74 cents, or 0.8%, at $90.70 a barrel by 1430 GMT. US West Texas Intermediate (WTI) crude futures were up 87 cents, or 1%, at $88.22. Crude oil prices rose on Wednesday with Brent rising above $90 a barrel for the first time in seven years amid tensions between Russia and the West.
Russia, the world’s second largest oil producer, and the West are at loggerheads over Ukraine, which is expected to disrupt energy supplies to Europe. Both contracts were lower in early trade after the US Federal Reserve said on Wednesday it was likely to raise interest rates in March and plans to end its bond purchases that month in its fight to contain inflation. The US dollar climbed after the announcement, making oil more expensive for buyers using other currencies.
“The Ukraine crisis is preventing further price declines, as there are still concerns that Russian oil and gas delivery could be disrupted in the event of a military escalation,” Commerzbank said in the morning after the price drop.
Russia, the world’s second largest oil producer, and the West are at loggerheads over Ukraine, which is expected to disrupt energy supplies to Europe.
Markets are also turning their attention to the February 2 meeting of the Organization of the Petroleum Exporting Countries (OPEC) and allies led by Russia, known as OPEC+. Several OPEC+ sources told Reuters that the group is likely to stick with the planned increase in its oil production target for March. OPEC+ has raised its production target by 400,000 barrels per day (bpd) every month since August as it takes a record production cut in 2020.
However, the group has faced capacity constraints which have prevented some members from producing at their quota level. Still, an increase in crude oil and gasoline inventories in the United States eased some concerns about supplies.
Crude oil reserves rose 2.4 million barrels last week, the Energy Information Administration (EIA) said on Wednesday. That compared to expectations of a drop of 728,000 barrels in a Reuters poll of analysts. Petrol reserves have increased by 1.3 million barrels since February 2021.
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