Oil prices up following Russian remarks on maintaining tight supplies

By Sibel Morrow and Duygu Alhan

Oil prices rose on Thursday due to supply concerns after Russia confirmed that existing OPEC+ production curbs would continue, but a projected massive surge in US crude oil inventories hindered further price upticks.

International benchmark crude Brent traded at $86.67 per barrel at 11.21 a.m. local time (0821 GMT), a 0.99% gain from the closing price of $85.82 a barrel in the previous trading session on Wednesday.

The American benchmark West Texas Intermediate (WTI) traded at the same time at $84.12 per barrel, up 0.75% from Wednesday’s close of $83.49 per barrel.

Oil prices allayed in early Asian trade on Thursday as Saudi Arabia, OPEC's swing producer, committed to helping stabilize oil markets by supplying extra barrels, according to the Saudi Press Agency.

Prices further declined after the American Petroleum Institute (API) announced late Wednesday its estimation of a build in US crude oil stockpiles of 12.9 million barrels against the market expectation of a rise of 1.3 million barrels.

A strong increase in inventory implies a fall in crude demand in the US, assuaging market concerns over falling demand.

The US Energy Information Administration's (EIA) data on oil stocks will be announced later on Thursday, and if the increase in stock levels is confirmed, prices are expected to decline.

Concerns about Iran's possible non-involvement in the Palestine-Israel conflict dampened upward price movements. According to some international media sources, Iran was taken aback by Hamas' onslaught, bolstering optimism that the Hamas-Israel conflict will not spread to Iran, OPEC's third-largest producer.

However, prices rose as investors focused on Russian President Vladimir Putin’s remarks, signaling the OPEC group’s resolution to keep supplies tight.

Speaking on the sidelines of the Russian Energy Week in Moscow, Putin said on Wednesday that the coordination between OPEC and its allies would continue and signaled that a deal to limit supplies to global markets was permanent.