Oil prices rose on Friday and closed the week with gains over the US Memorial Day weekend, the start of the busiest fuel demand season in the US, and as European countries negotiated whether to impose a direct ban on Russian crude oil.
Brent crude was up $2.03, or 1.7%, to settle at $119.43. West Texas Intermediate (WTI) crude was up 98 cents, or 0.9%, to $115.07 a barrel. For the week, Brent was up 6%, while WTI was up 1.5%.
Oil prices have risen nearly 50% so far this year.
Prices were supported by strong worldwide fuel demand, with both gasoline and heating fuel futures outpacing crude this year. Demand is strong with leading products, especially gasoline, which brings with it crude oil.
Driving season and strong travel demand in the US will help increase prices. With supply growth lagging behind demand growth, the oil market is likely to be under-supplied. Therefore, the expectation for a rise in crude oil prices remains positive.
Hungary’s resistance to oil sanctions and other countries’ reluctance has prevented the 27-member EU from applying its sixth package of sanctions against Russia after its invasion of Ukraine.
EU members are negotiating an agreement on sanctions that would impose an embargo on Russia’s oil shipments to European Union countries, but failed to persuade Hungary, and some landlocked countries that meet their needs through pipelines..
EU government leaders will meet in Brussels at the summit to be held on 30-31 May, which will start on Sunday. Some of them eagerly awaiting approval of the issue.
News that Iranian forces seized two Greek oil tankers in the Persian Gulf on Friday has made investors cautious as we enter this weekend. Meanwhile, recession fears are thought to be exaggerated and oil and gas demand is forecast to be stronger.
Russian President Vladimir Putin told Austrian Chancellor Karl Nehammer that Moscow will honor its gas distribution commitments.