Benchmark Brent crude prices rose over 1% to $66.70 per barrel, while U.S. West Texas Intermediate prices gained 1.1% to $62.93 per barrel at 3.37 a.m. ET.
Oil prices edged higher on Tuesday as the prospect of further sanctions on Russia offset some concerns about oversupply.
Benchmark Brent crude prices rose over 1% to $66.70 per barrel, while U.S. West Texas Intermediate prices gained 1.1% to $62.93 per barrel at 3.37 a.m. ET. Retail sentiment on Stocktwits about the United States Oil Fund (USO) was in the ‘bullish’ territory at the time of writing.
U.S. President Donald Trump said on Sunday that his administration was willing to move to the next phase of sanctions on Russia and its oil buyers as the country launched its largest air attack of the war over the weekend. The European Union has also said that it is working closely with the U.S. over the next round of sanctions.
Russia, however, expressed a defiant tone. “No sanctions will be able to force the Russian Federation to change the consistent position that our president has repeatedly spoken about,” Kremlin spokesman Dmitry Peskov said, according to a Reuters News report.
The rising geopolitical tensions appear to have eased concerns about a fresh output hike by OPEC+. The oil-producing group, led by Saudi Arabia, agreed to raise output by 137,000 barrels per day on Sunday, much lower than the over 550,000 bpd of production hike in August and September. Riyadh aims to regain market share lost during the pandemic, while also providing opportunities for overproducing members to compensate.
“Sanctions on Russian crude oil supplies still represent a potential offsetting
geopolitical risk,” analyst Tim Evans noted.
Investor focus will now shift to the oil demand outlook from the Department of Energy and OPEC+. Traders will also keep an eye on U.S. consumer price index data, which is due on Thursday. The crucial inflation data will point toward the Federal Reserve’s possible decision on benchmark interest rates, expected next week. Analysts largely expect the U.S. central bank to lower rates by 25 basis points.
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