OPEC and its allies continued to struggle to boost production as oil prices soared on Monday along the supply disruption concerns amid escalating tensions in Eastern Europe and the Middle East that further tightened the already tight market.
Brent crude futures rose 81 cents, or 0.9%, to $88.70 a barrel as of 0344 GMT, reversing Friday’s 0.6% loss.
West Texas Intermediate (WTI) after crude futures fell 0.5% on Friday, is up by 72 cents, or 0.9% a barrel to $85.86
After rising for the fifth week in a row, both indicators rose 2% last week, reaching their highest level since October 2014. Prices have already risen more than 10% this year amid concerns about tighter supply.
Oil continued to rise due to geopolitical risks between Russia and Ukraine and in the Middle East, while OPEC+ continued to fail to meet its production target. The expected increase in heating oil demand due to the cold weather in the USA increased the pressure on prices. Analysts expect cold weather to increase heating demand over the next few weeks.
Fueling fears of supply disruptions in Eastern Europe, the United States on Sunday instructed family members of embassy staff in Ukraine to leave, citing Russia’s continued threat of military action.
The New York Times reported late Sunday that the United States is considering sending several thousand US troops to NATO allies in Eastern Europe and the Baltic.
Britain said on Sunday it would face serious economic sanctions if Russia installed a puppet regime supporting his benefits in Ukraine.
The United Arab Emirates said it destroyed two Houthi ballistic missiles without any casualties.
OPEC+ has some members struggling to meet its target of 400,000 barrels per day (bpd) monthly production growth. According to two sources from the producer group OPEC+, compliance with long-installed oil production cuts rose to about 122% in December, indicating that some members continue to struggle to raise their output.
Expectations that OPEC+ members such as Saudi Arabia and Russia will continue their current policy of gradual production increase to keep Brent oil prices between $85 and $90 per barrel support the general sentiment.
The U.S. Commodity Futures Trading Commission (CFTC) said on Friday that money managers increased their net long U.S. crude futures and options positions to Jan. 18 this week.
In the United States, energy firms stopped adding oil rigs this week for the first time in 13 weeks, as oil stocks continued to fall over the past month.