Oil Prices Reach Three-Week Highs on Sanctions Rumors and OPEC Underproduction

Oil prices rose to nearly three-week highs on fears that there could be further disruptions to global supplies as the conflict in Ukraine escalates. In addition, there is also news that Western countries may impose additional sanctions on Russia.

  • Brent futures were up $1.09, or 1.0%, at $112.79 a barrel.
  • WTI crude futures were up $1.00, or 0.9%, to $107.95 a barrel.

Both grades of crude oil rose more than 2.5% on Thursday ahead of the Easter holiday on news of a possible EU ban on oil from Russia.

The EU said it was in the process of drafting measures against the energy sanctions, but Germany did not immediately support them.

The International Energy Agency has warned that sanctions or the abandonment of Russian oil purchases will result in 3 million barrels a day of Russian oil not being exported from the country starting in May.

OPEC and OPEC+, including Russia, have rejected the West’s calls to increase output.

According to an OPEC report last week, OPEC production increased by only 57,000 barrels per day in March to 28.56 million barrels per day. It produced 253,000 barrels per day less than the OPEC+ agreement.

Tensions in the energy market also intensified when Libya halted oil production from the El Feel field on Sunday. Exports were suspended as supporter groups of Prime Minister Abdulhamid al-Dbeibah occupied the area.

However, in view of rising oil prices, oil production in the United States is expected to increase despite labor and energy shortages.

The Spot Market is Open

Monday, April 18, 2022

Energy
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Crude Oil
20.45
108.63+1.681.57%

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