Brent crude futures for May climbed by 7 cents to $86.82 a
barrel, while U.S. West Texas Intermediate (WTI) crude futures rose 6 cents to
$82.01 a barrel at 0541 GMT.
Brent rose 1.5% in Monday's session while WTI gained 1.6%
higher after Russia's government ordered companies to cut output in the second
quarter to meet a 9 million barrels per day (bpd)target to comply with pledges
to the OPEC+ consumer group.
Russia, a top three global oil producer and one of the
largest exporters of oil products, is also contending with recent attacks on
its oil refineries by Ukraine that Goldman Sachs analysts said has knocked
about 900,000 bpd of capacity offline, possibly for weeks and even in some
cases permanently.
"The impact of refining disruptions on crude prices is
mixed, with a bearish effect from the decline in refinery demand and a bullish
effect from the potential reduction in Russia oil exports," the analysts
said in a note.
After a Ukrainian drone attack on Saturday, Russian oil
producer Rosneft shut a 70,000 bpd crude unit at its Kuibyshev refinery in the
city of Samara.
While the consequences of the attacks and Russian cuts
seemed unclear, a slightly weaker U.S. dollar from the previous session
somewhat supported prices.
A weaker dollar typically makes it cheaper for oil purchases
in other currencies which could bolster overall demand.
"The USD may continue to face downside pressure as the
Fed is expected to cut rates later this year, which potentially offers the
bullish factor to oil prices," said independent market analyst Tina Teng.
Rising geopolitical premiums as the Israel-Gaza conflict
ongoing were also supportive of prices, though an immediate impact on supplies
in the Middle East region remains to be seen.
A positive geopolitical risk premium, as there is no clear ceasefire breakthrough between Israel and Hamas, remains a key supportive price factor for oil at this juncture, said senior market analyst Kelvin Wong at OANDA.
0 comments:
Post a Comment