Brent crude futures were up $3.10, or 2.8%, at $114.24 a barrel by 0419 GMT after trading in the higher $5 range
Brent crude futures were up $3.10, or 2.8%, at $114.24 a barrel by 0419 GMT after trading in the higher $5 range
Oil prices rose on March 10 after a sharp fall in the previous session as markets pondered whether major producers would boost supplies to help bridge the gap in output from Russia, due to sanctions for it. invasion of ukraine,
Brent crude futures were up $3.10, or 2.8%, at $114.24 a barrel by 0419 GMT after trading in the higher $5 range. The benchmark contract fell 13% in the last session in its biggest one-day fall in nearly two years.
US West Texas Intermediate (WTI) crude futures were up $1.58, or 1.5%, at $110.28 a barrel, after trading in a more than $4 range. The contract had fallen 12.5% in the previous session in the biggest daily drop since November.
Uncertainty over where and when supplies will come to replace crude from Russia, the world’s second-largest exporter, in a tight market has led to broad forecasts of oil prices in the range of $100 to $200 a barrel.
“So to suggest that the oil market is confused would be an understatement because we are in an unprecedented situation,” said Stephen Innes, managing partner at SPI Asset Management. Comments from the UAE’s energy minister and the country’s ambassador to Washington sent conflicting signals.
UAE Energy Minister Suhail Al-Mazrouei said on Twitter late Wednesday that his country is committed to an existing agreement by the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, called OPEC+, to increase oil supply by 4 percent. can be increased to ,00,000. Barrels per day monthly after a sharp cut in 2020.
“The UAE believes in the value of OPEC+ that oil brings to the market,” said Mr. Al-Mazrouei. Just hours earlier, prices plummeted on comments by the UAE ambassador in Washington that his country would encourage OPEC to consider higher output to fill the supply gap caused by sanctions on Russia after its invasion of Ukraine. . Russia called its incursion a “special operation” to disarm its neighbour.
The comments by UAE officials came as the market took note of efforts by the United States to ease sanctions on Venezuelan oil and seal the nuclear deal with Tehran, which will lead to more oil supplies from Iran later this year. Might be possible.
On Thursday talks between the foreign ministers of Russia and Ukraine in Turkey also cited the reason for the market to pause. While the United Arab Emirates and Saudi Arabia have excess capacity, some other OPEC+ producers have been struggling to meet their production targets over the past few years due to low investment in infrastructure, which may help them to ramp up production further. will limit the capacity.
“We think it will be challenging for OPEC+ to boost production in this environment,” said Vivek Dhar, commodities analyst at Commonwealth Bank. However, Standard Chartered analysts predicted that OPEC would seek to fill the Russian supply gap, “effectively ending the OPEC+ agreement in its current form”.