Crude oil prices rebounded from a decline on Friday midday on hopes that Hungary could use Russian crude.
Brent crude futures closed up 25 cents, or 0.39%, at $63.63 per barrel. WTI crude oil rose 32 cents, or 0.54%, to $59.75 per barrel.
Both indices are expected to decline about 2% for the week as major global producers increase production.
Hungary has maintained its reliance on Russian energy since the start of the conflict in Ukraine in 2022, a situation that has drawn criticism from many European Union and NATO allies.
Prices fell earlier on friday, and Brent crude weakened due to flight disruptions caused by the lack of air traffic controllers and unpaid salaries due to the US government shutdown.
The US Federal Aviation Administration (FIA) has ordered airlines to ground thousands of flights due to a shortage of air traffic controllers. The grounding is significantly reducing diesel demand and demand for jet fuel.
An unexpected 5.2 million barrel stockpile increase in the US has reignited concerns about oversupply this week.
The Energy Information Administration (EIA) said on Wednesday that US crude oil inventories rose more than expected due to increased imports and reduced refinery activity, while gasoline and distillate inventories fell.
Private sector reports also indicate a weakening US labor market. US Labor Department employment reports are not being released due to the shutdown.
OPEC+ decided on Sunday to slightly increase production in December. However, the group paused further increases in the first quarter of next year due to concerns about oversupply.
The well-supplied market prompted Saudi Arabia, the world’s largest oil exporter, to announce a sharp price cut for Asian buyers in December.
Meanwhile, sanctions imposed by Europe and the US on Russia and Iran are providing some support to global markets by disrupting supplies to the world’s largest importers, China and India.
According to customs data, China’s crude oil imports in October reached 48.36 million tons, a 2.3% increase compared to September and 8.2% compared to the previous year. This is despite high utilization rates at refineries in the country, the world’s largest oil importer.
China continued to import large amounts of crude oil in October. This move is keeping crude away from OECD countries, where inventories remain low.
Swiss commodity trader Gunvor announced on Thursday that it has withdrawn its offer to acquire foreign assets of Russian energy company Lukoil after the US Treasury Department labeled Lukoil a “puppet” of Russia and Washington expressed opposition to the deal.
Gunvor’s cancellation of the Lukoil asset purchase indicates that the US is continuing its maximum pressure campaign against Russia and will strictly enforce sanctions against Rosneft and Lukoil.