Crude oil gains on Russian supply cut worries, but higher US inventories weigh

Crude oil gains on Russian supply cut worries, but higher US inventories weigh

Oil prices extended gains for a second session on Friday as the prospect of lower exports from Russia offset rising inventories in the United States. Brent crude futures rose 61 cents, or 0.7%, to $82.82 per barrel by 0215 GMT. West Texas Intermediate crude futures (WTI) rose 63 cents, or 0.8%, to $76.02 a barrel.

Both benchmarks ended Thursday about 2% higher on Russia’s plans to cut oil exports from its western ports by up to 25% in March which exceeded its announced production cuts of 500,000 barrels per day. These reports lifted sentiment on the supply side, ANZ analysts said in a note.

The prospect of further rate hikes supported the dollar index, which was set for a fourth straight week of gains. The index is now up about 2.5% for the month. A firm dollar makes commodities priced in the greenback more expensive for holders of other currencies.

“The focus as we close the week will be on what happens with next inflation report, will the market get more nervous on even more tightening from the Fed,” OANDA analyst Edward Moya said. Oil has also been pressured by a surge in U.S. crude inventories to the highest since May 2021, as refiners ran less oil during a strong maintenance season. Crude inventories rose by 7.6 million barrels to a about 479 million barrels, data from the U.S. Energy Information Administration said