Oil prices set for weekly jump on Russia supply risks, U.S. stock draw
Oil prices steadied Friday, but were on course for a strong weekly rise as concerns over Russian supply disruptions and a surprise drop in U.S. crude inventories tightened the market outlook.
At 04:40 ET (08:40 GMT), Brent Oil Futures expiring in November fell 0.1% to $69.39 per barrel, while West Texas Intermediate (WTI) crude futures gained 0.1% to $65.03 per barrel.
Both benchmarks remained at their highest since early August and were set to jump over 4% this week, their biggest increase since June.
Russia supply risks
The crude market has seen supply risks amplified this week by Ukrainian drone strikes on Russian energy facilities in regions including Bryansk, Samara, and Bashkortostan.
Kyiv has targeted refineries and petrochemical plants, disrupting throughput and raising questions over the reliability of Russian product exports.
Moscow said this week it would impose partial curbs on diesel exports and extend a gasoline export ban until end-2025, in a bid to safeguard domestic fuel supplies.
Washington and its allies are also weighing fresh sanctions on Moscow, adding to concerns that Russian crude and diesel exports could shrink further.
OPEC+ struggling to deliver extra output
OPEC+ has delivered about three quarters of the extra oil output it targeted since the group started production hikes in April, and the level may fall closer to half later in the year as producers hit capacity limits, Reuters reported.
Eight members of OPEC+ that introduced voluntary oil output cuts in April 2023 to support the market began raising output this April. OPEC+ total reductions - voluntary and for the whole group - amounted at their peak to 5.85 million bpd in three different layers.
U.S. crude drawdown
On the demand side, data this week showed a larger-than-expected drawdown in U.S. crude inventories.
Figures from the American Petroleum Institute estimated a 3.8 million barrel decline in the week to Sept. 19, while official data from the Energy Information Administration confirmed a smaller but still notable drop.
The reports signalled tighter near-term balances and provided fresh support for prices.
Source: Reuters
