Oil Increases by 2% on Supply Concerns

Brent crude was higher by $1.40, or 1.70%, to $82.38 a barrel at 1044 GMT. Meanwhile, U.S. WTI crude was at $78.98 a barrel, up $1.49, or nearly 2 % higher.

Both contracts were on the path to posting a second weekly increase.

As stated by traders and Reuters calculations, Russia’s Baltic oil exports could decline by 20% in December from the prior month after the European Union and G7 nations assessed sanctions and a price cap on Russian crude from Dec. 5.

Russia may slash oil production by 5%-7% in early 2023 as it reacts to price caps.

Extreme Weather Could Boost Oil

More than 4,400 U.S. flights have been withdrawn over two days expected to the winter storm, overlapping with a holiday travel season that some predict could be the busiest.

On Thursday, oil prices on both sides of the Atlantic dropped as flights were scrapped. The snowstorm could also upend motorists’ methods to travel during Christmas and New Year, restraining gasoline consumption.

Nevertheless, heating oil demand could be increased as extreme weather is predicted to cause power outages.

U.S. crude stocks dropped more than anticipated in the week to Dec. 16 as imports declined sharply.

Nevertheless, flooding coronavirus cases in the world’s No.2 oil consumer China, worries regarding additional rate hikes globally, and the recession impeding fuel consumption capped oil price gains.