SULAIMANI (ESTA) — Oil prices rose on Monday as worries over tight supplies persisted after Germany warned of more sanctions on Russia and talks to revive the Iran nuclear deal paused.
Brent crude futures were up 53 cents at $104.9 a barrel by 0818 GMT while U.S. West Texas Intermediate crude was up 59 cents at $99.86.
Both contracts slipped $1 when markets opened on Monday but rebounded after Iran blamed the United States for pausing talks aimed at reviving their 2015 nuclear deal, which would allow a lifting of sanctions on Iranian oil supplies, according to Reuters.
This added to concerns about tight supplies. Russian crude and oil products exports have been hit by Western sanctions and buyer aversion after Russia’s invasion of Ukraine.
Germany said on Sunday that the West would agree to impose more sanctions on Russia in the coming days after Ukraine accused Russian forces of war crimes near Kyiv. Russia has rejected allegations of war crimes in what it calls a “special military operation” aimed at demilitarising Ukraine, Reuters reported.
“Oil has crept higher today as Europe signalled that it is preparing new sanctions against Russia,” Reuters quoted OANDA senior analyst Jeffrey Halley as saying.
Estimates of the Russian oil supply loss range from 1 million to 3 million barrels per day (bpd), further tightening global markets that are already grappling with low inventories.
“Normalised stocks are at historical lows and the seasonally adjusted deficit remains large and getting worse,” Goldman Sachs analysts said, Reuters reported.
They added that a large increase in jet fuel consumption is expected this summer with the return of international travel.
