Crude oil prices rose on Tuesday as some European Union members continue debates on imposing an oil embargo on Russia, while assaults on Saudi infrastructure caused market concerns.
At 0440 GMT, front-month West Texas Intermediate futures on the New York Mercantile Exchange were up $2.20, or 1.96 percent, to $114.32 a barrel, while Brent futures on the Intercontinental Exchange were up $3.18, or 2.75 percent, to $118.80 a barrel.
On Monday, both futures were up more than 7% as the market evaluated the possibility of additional supply interruptions. find out more
Foreign ministers in the European Union are split on whether to join the US in penalizing Russian oil, with some nations, such as Germany, saying that the unit is overly reliant on Russian fossil resources.
In a report, Edward Moya, an analyst at OANDA, said, “It appears energy speculators are getting more optimistic that supply constraints are just around the horizon.”
Prices are rising in reaction to geopolitical fears in Ukraine as well as threats on Saudi Aramco facilities, according to Moya.
“Right now, it appears that the dangers are increasing, which might drive crude prices higher.”
Following attacks on its oil installations by Iranian-aligned Houthis, Saudi Arabia has warned that it would not be held responsible for global supply disruptions.
The remarks come after the organization launched rockets and drone attacks on Saudi state oil business facilities over the weekend, causing a brief drop in refinery output.
Additional concerns about OPEC+ output, according to analysts, might worsen supply problems.
“We anticipate that the disparity between OPEC+ production objectives and actual output was just above 800,000 barrels per day (bpd) last month and will climb to a stunning 1.15 million bpd in March,” according to a note from consultancy JBC Energy.
Meanwhile, according to a preliminary Reuters poll released on Monday, US crude oil stocks were likely unchanged from last week.
And last week, analysts have predicted that gasoline (petrol) stocks declined by around 2.1 million barrels, while distillate inventories, which include diesel and heating oil, fell by 1.6 million barrels.
The survey was taken ahead of the American Petroleum Institute’s (API) report, which will be released at 4:30 p.m. EST (2130 GMT) on Tuesday.
