Oil Prices Rise on Russian Production Cut Fears, but Rising U.S. Inventories Weigh

Oil prices rose for a second session on Friday, as the possibility of decreased Russian supplies outweighed rising US inventories.

By 10:49 AM (Thai time), Brent crude futures had risen 63 cents, or 0.77 percent, to $82.84 per barrel. The price of a barrel of West Texas Intermediate (WTI) crude oil futures increased by 58 cents, or 0.77%, to $75.97.

Following news that Russia would reduce oil shipments from its western ports by up to 25% in March—far more than the 500,000 bpd in production cuts that had been previously announced—prices for both benchmarks rose by around 2% by the day’s conclusion.

After dropping by over 4% the previous week, oil prices fell by a smaller amount this week on the back of rising interest rate worries that could strengthen the dollar and a ninth consecutive week of an increase in U.S. crude supplies.

According to the minutes from the latest meeting of the Federal Reserve, the majority of officials still have a hawkish view on inflation and the tight labor market, suggesting that the central bank will continue to tighten monetary policy.

U.S. crude stockpiles have risen to their highest level since May 2021, putting additional downward pressure on oil prices as refineries cut oil usage in preparation for a busy maintenance period.