Reuters reported that oil prices rose after a decline of nearly ten percent in the previous two sessions, supported by supply concerns as the European Union works to rally support for a ban on Russian oil and with the halt of Russian gas supplies to Europe through a major transit point in Ukraine. The European Union proposed banning Russian oil imports, which analysts say will exacerbate supply shortages in the market and alter trade patterns. The vote, which must be unanimous, has been postponed as Hungary maintains its opposition to the ban.
By 08:15 GMT, Brent crude rose by $2.86 or 2.8 percent to $105.32 per barrel. U.S. West Texas Intermediate crude reached $102.29 per barrel, an increase of $2.53 or 2.5 percent. Oil prices were also supported by optimism regarding the Chinese economy after a decline in factory gate price inflation in China, with investors feeling relieved by signs of a drop in local COVID-19 infections. Additionally, oil received support from disruptions in Russian gas supplies.
Oil prices rose in 2022 after the Russian war in Ukraine intensified supply concerns, with Brent reaching $139 per barrel in March, its highest level since 2008. Concerns over economic growth in China due to COVID-19 containment measures and rising U.S. interest rates were behind this week's decline in oil prices.
