Oil Up, Exceeds $116 Mark As Tight Supply Remains

  • Posted on March 03, 2022
  • News
  • By FC Team

Investing.com – Oil was up on Thursday morning in Asia, extending a rally as Brent futures climbed above $116. Trade disruption and shipping issues from Western sanctions against Russia over its recent invasion of Ukraine drove supply worries, while U.S. crude supplies fell to multi-year lows.Brent oil futures jumped 3.01% to $116.33 by 11:04 PM ET (4:04 AM GMT), the highest level since August 2013. WTI futures rose 2.59% to $113,.47, after hitting a fresh 11-year high of $113.31.The Organization of the Petroleum Exporting Countries and allies (OPEC+), which includes Russia, decided to maintain an increase in output by 400,000 barrels per day in its meeting on Wednesday. The cartel seemingly ignored surging prices, the invasion, and calls from some corners to increase supply."The White House ratcheted up pressure on Russia with the announcement that it will apply export controls targeting Russian oil refining. This raises concerns that Russian oil supplies will continue to hit constraints," ANZ analysts said in a note.This was in reaction to fresh U.S. sanctions on the Russian oil refining sector, sparking fears that the country’s oil and gas exports could be the next target. The U.S. has so far not touched Russia's oil and gas exports as it weighs the implications of such a move on global oil markets and U.S. energy prices.Russia is the third-largest oil producer and the largest oil exporter globally, according to the International Energy Agency.Meanwhile, Wednesday's crude oil supply data from the U.S. Energy Information Administration showed a draw of 2.597 million barrels in the week to Feb. 25. Forecasts prepared by Investing.com had predicted a build of 2.748 million barrels, while a 4.515-million-barrel build was recorded during the previous week. Crude oil supply data from the American Petroleum Institute released the day before, showed a draw of 6.1 million barrels.

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