Crude oil prices rise in early trade

27 Mar 2023 , 09:32 AM

While geopolitical tensions in Europe increased as a result of remarks made by Russian President Vladimir Putin over the weekend, oil prices rose in early trade on Monday as worries about turbulence in the financial sector subsided.

Brent crude futures were up 33 cents, or 0.4%, to $75.32 a barrel. U.S. West Texas Intermediate crude was up 39 cents or 0.6% at $69.65 a barrel.

While concerns in the banking sector subsided, WTI recovered 3.8% and Brent increased 2.8% last week.

He noted that the increase in oil prices was more of a relief rally and a correction following a 16% decline in the previous two weeks.

Costs increased as a result of President Vladimir Putin’s announcement that Belarus will host tactical nuclear weapons, which increased geopolitical tensions in Europe related to Ukraine.

On Sunday, NATO criticised Putin for his ‘dangerous and irresponsible’ nuclear threats.

Aleksandr Novak, the deputy prime minister of Russia, declared on Friday that the country was extremely close to meeting its goal of reducing oil production by 500,000 barrels per day (bpd), or to about 9.5 million bpd.

Russia is anticipated to keep up crude oil exports despite falling output by reducing refinery output in April, according to information from industry sources and calculations by Reuters on Friday.

The latest EU embargo has so far had a greater impact on Russian oil product exports than on crude exports, with tonnes of diesel sitting on ships waiting for customers.

Refineries in France are being disrupted by labour unrest, which lowers the demand for oil and lowers fuel production.

The release of China’s manufacturing and services PMIs later this week will be closely watched by investors.

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