Business News Asia
Crude oil futures closed nearly 4% higher on Wednesday (April 13) on fears of a tightening global supply. Russia, one of the members of the OPEC+ group, announced that peace talks with Ukraine have reached a dead end.
- WTI crude futures rose $3.65, or 3.6%, at $104.25 a barrel.
- BRENT crude futures rose $4.14, or 4%, at $108.78 a barrel.
Crude oil futures rose after Russian President Vladimir Putin declared that the Russian invasion of Ukraine will continue until the goal is achieved and confirmed that the battle will continue as planned. In the face of strong Ukrainian resistance, Russia has even considered a massive withdrawal. Russia has lost thousands of soldiers in the fighting in Ukraine, which has been ongoing since late February.
President Putin’s statement shows that the war between Russia and Ukraine may continue and it is likely that this will have an impact on the global oil supply as many countries are likely to consider tougher sanctions.
OPEC Secretary-General Mohammed Barkindo warned that in the event of Russian oil sanctions, OPEC will not be able to make up for the lost 7 million barrels per day. Therefore, expectations are that the price of oil will not be determined by fundamentals, but mainly by current political factors.
Crude oil contracts were unaffected by the U.S. Federal Energy Information Administration (EIA) report released last night. U.S. crude oil inventories rose 9.4 million barrels to 421.8 million barrels in the week ended April 8.
Gasoline inventories declined by 3.6 million barrels, while distillate inventories, including heating oil and diesel, fell by 2.9 million barrels to 111.4 million barrels, the lowest level since 2014.
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Thursday, April 14, 2022