Crude oil prices gained in early Asian trade on Wednesday with renewed geopolitical tension with Russia warning to cut off gas supply to Poland and Bulgaria.
The WTI rose 0.76% trading around $102 a barrel while the Brent is up by 0.99% trading around $106 a barrel.
Russia’s Gazprom has told Poland and Bulgaria it will halt gas supplies from Wednesday, in a major escalation of Russia’s broader row with the West over its invasion of Ukraine, which Moscow calls a “military operation”.
“Oil is supported via the escalation of geopolitical tensions,” Stephen Innes of SPI Asset Management said in a note.
“Cutting gas flows is not new news, but it’s the timing of Russia plugging the gas flows when stagflationary fears are running rampant again.”
Chinese central bank on Tuesday said it will step up monetary support to deal with the economic slowdown. Any stimulus would boost oil demand.
China’s central bank said on Tuesday it will step up prudent monetary policy support to its economy as Beijing races to stamp out a nascent COVID-19 outbreak in the capital and avert the same debilitating city-wide lockdown that has shrouded Shanghai for a month. Any stimulus would boost oil demand.