Russia-Ukraine Tensions Fuel Oil Price Rise

18 Nov 2024 , 10:32 AM

Despite worries about fuel consumption in China, the world’s second-largest consumer, and predictions of a worldwide oil surplus, oil prices increased slightly on Monday following the weekend escalation between Russia and Ukraine.

U.S. West Texas Intermediate crude prices were up 9 cents, or 0.1%, to $67.11 a barrel, while Brent crude futures had increased 20 cents, or 0.3%, to $71.24 a barrel.

Two U.S. officials and a source familiar with the decision claimed on Sunday that President Joe Biden’s administration has permitted Ukraine to deploy U.S.-made weapons to strike deep into Russia, marking a significant reversal of Washington’s policy in the Ukraine-Russia conflict.

The Kremlin, which has cautioned that it would consider a move to relax restrictions on Ukraine’s use of American weaponry a significant escalation, did not immediately respond.

Ukraine’s electricity system was severely damaged on Sunday when Russia launched its biggest airstrike against the country in nearly three months.

Five industry insiders claim that at least three refineries in Russia have been forced to stop operations or reduce production as a result of significant losses brought on by export restrictions, rising crude prices, and expensive borrowing.

Last week, dismal statistics from China and the International Energy Agency’s prediction that the world’s oil production will surpass demand by more than 1 million barrels per day in 2025 caused Brent and WTI to drop more than 3%.

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