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Oil futures rose Friday, on track for a sixth straight weekly gain as fears around a potential Russian invasion of Ukraine and tight crude supplies continue to provide support.
West Texas Intermediate crude for March delivery
CL00,
CLH22,
rose 60 cents, or 0.7%, to $87.21 a barrel on the New York Mercantile Exchange, on track for a 2.5% gain. March Brent crude
BRNH22,
the global benchmark, was up 85 cents, or 1%, at $90.19 a barrel on ICE Futures Europe. April Brent
BRN00,
BRNJ22,
the most actively traded contract, rose 66 cents, or 0.7%, at $88.83 a barrel.
“There are no new reasons to explain the renewed surge in the crude oil price: it is still concerns about supply disruptions if the Ukraine crisis escalates. The risk premium on the oil price is now likely to be almost $10,” said Carsten Fritsch, analyst at Commerzbank, in a note.
Both WTI and Brent closed at their highest since October 2014 on Wednesday, before settling back modestly in Thursday’s session, dogged in part by a surging U.S. dollar a day after the Federal Reserve set a hawkish tone at its first policy meeting of 2022.
Russia has massed around 100,000 troops on Ukraine’s border as it demands that NATO never admit Ukraine and other ex-Soviet nations as members, and that the alliance roll back troop deployments in other former Soviet bloc nations — demands the U.S. and its allies have deemed nonstarters.
President Joe Biden warned Ukraine’s leader on Thursday of a “distinct possibility” Russia could take military action against it in February. Russian Foreign Minister Sergei Lavrov on Friday told Russian radio stations that there “won’t be a war as far as it depends on the Russian Federation, we don’t want a war,” but added “we won’t let our interests be rudely trampled on and ignored.”
Attention may also be turning to next week’s meeting of the Organization of the Petroleum Exporting Countries and its allies, which includes Russia.
OPEC+ has been sticking to a timetable in which it raises output by 400,000 barrels a day in monthly increments, resisting pressure from the U.S. and other oil consumers to boost output more quickly. Meanwhile, several OPEC+ producers have struggled to meet increased quotas.
Analysts said the group may be concerned by crude at current price levels, fearing a push above $90 a barrel or so could result in significant demand destruction.
Read: Why OPEC+ may not want $100 oil prices
March natural-gas futures
NG00,
rose 3.7% to $4.441 per million British thermal units. On Thursday, the February natural-gas contract surged 46% in a “classic” short squeeze ahead of its expiration and as a winter storm looms in the Northeast.
See: Why natural-gas futures logged their biggest one-day percent gain on record
