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Oil prices climbed on Friday, trading near the highest level in 10 months seen earlier this week, after news Thursday that Russia has banned the export of diesel and gasoline which has pushed up prices in Europe.
Price action
- West Texas Intermediate crude futures for November delivery rose 84 cents, or 0.9%, to $90.46 a barrel on the New York Mercantile Exchange.
- November Brent crude futures increased by 63 cents, or 0.7%, to $92.88 a barrel on ICE Futures Europe.
- October gasoline rose by 0.7% to $2.59 a gallon, while October heating oil gained 0.6% to $3.386 a gallon.
- November natural gas rose by 1.5% to $2.88 per million British thermal units.
Market drivers
Global energy prices have been rising since Russia announced on Thursday a temporary ban on exports of gasoline and diesel outside a small circle of closely allied states in order to keep supplies available for processing the annual wheat harvest in particular. Russia is one of the world’s biggest seaborne exporters of diesel and the ban follows a fall in shipments earlier this month, which helped push up diesel prices in Europe.
It’s the latest in a series of production cuts and supply restrictions that have helped prop up energy prices since mid-July. Rising oil prices contributed to consumer prices rising in the U.S. in August, and as inflation expectations rise, they could complicate the Federal Reserve’s mission to tame inflation, potentially creating problems for global equity markets.
Many analysts expect crude prices traded in the U.S. and in international markets to move up to, or past, $100 a barrel, a level oil hasn’t seen since last year.
“Brent oil has already surpassed the $95 level and could climb towards $100 if the OPEC+ continues to withhold supply,” said Fawad Razaqzada, market analyst at City Index and FOREX.com, in emailed commentary.
