Brent oil futures rose 1.07% to $108.40 and WTI futures jumped 1.18% to $103.25
Oil was up on Wednesday morning in Asia, rising about 1% and gaining back some losses from the previous session after the International Monetary Fund (IMF) cut its economic growth forecasts and triggered fuel demand concerns.
However, concerns over tighter supply following Russia’s invasion of Ukraine on Feb. 24 and the ensuing sanctions, also remain. Russia is the second-largest oil exporter globally and a key European supplier.
Higher energy prices could trigger demand rationing, ANZ Research said in a note. On the other hand, Chinese COVID-zero approach and strict lockdowns are keeping demand prospects subdued.
Brent oil futures rose 1.07% to $108.40 by 3:35 AM GMT and WTI futures jumped 1.18% to $103.25. Both Brent and WTI benchmarks fell 5.2% in Tuesday’s volatile trading.
Meanwhile, the International Monetary Fund on Tuesday slashed its forecast for global growth to 3.6 percent in 2022. The organization blamed the economic impacts of the war in Ukraine and warned that inflation was now a ‘clear and present danger’ for many countries.
The Organization of the Petroleum Exporting Countries and allies (OPEC+) produced 1.45 million barrels per day (bpd) below its production targets in March 2022, according to a report from the cartel reviewed by Reuters. Russian output began falling after the West imposed sanctions over the war in Ukraine, with the country producing about 300,000 bpd below its target in March at 10.018 million bpd based on secondary sources, the report added.
The situation in Libya also remains on investors’ radars, with the National Oil Corporation declaring force majeure at the country’s Brega oil port on Tuesday.
In the U.S., Tuesday’s crude oil supply data from the American Petroleum Institute showed a draw of 4.496 million barrels for the week ended Apr. 14.