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Oil futures rose Monday, bouncing after the biggest weekly drop in two years, as European leaders expressed outrage and called for additional sanctions against Moscow as images emerged over the weekend showing evidence of Russian atrocities in Ukraine.
Price action
-
West Texas Intermediate crude for May delivery
CL.1,
+2.87% CLK22,
+2.87%
rose $1.21, or 1.2%, to $100.48 a barrel on the New York Mercantile Exchange. -
June Brent crude
BRN00,
+2.39% BRNM22,
+2.39% ,
the global benchmark, was up $1.04, or 1%, at $105.43 a barrel on ICE Futures Europe. WTI, the U.S. benchmark, fell 12.8% last week, while Brent dropped 11.1%, the biggest weekly percentage declines for both since late April 2020.
Market drivers
The weekend saw grim headlines and images emerge out of Ukraine as Russian forces pulled back from positions near Ukraine’s capital, Kyiv. So far, the bodies of 410 civilians have been found in towns near the capital that were recently retaken from Russian forces, said Ukraine’s prosecutor-general, Iryna Venediktova.
Images of bodies, many showing signs of torture, in the city of Bucha prompted several European leaders to call for tougher sanctions against Moscow.
“However, the EU (European Union) is still unlikely to ban Russian oil and gas imports because it would not be possible to find an alternative supply of the latter in particular at short notice, meaning such a step would have serious economic consequences,” said Carsten Fritsch, commodity analyst at Commerzbank, in a note.
“Nonetheless, this topic is likely to move further into focus again after having seemingly taken more of a back seat of late, while the uncertainty surrounding the payment modalities for purchases of Russian gas has also abated,” he said.
The oil market was volatile last week, slumping as the U.S. announced the release of 1 million barrels a day of crude for the next six months from its Strategic Petroleum Reserve, while the International Energy Agency on Friday said they would release additional barrels.
Oil’s gains were limited by concerns over rising COVID-19 cases in China. The country last month locked down Shanghai, its largest city and financial capital, as part of its zero-COVID policy.
Investors were also weighing the announcement late Friday of a two-month truce in Yemen between a Saudi-affiliated coalition and Iran-backed Houthi rebels. Crude-oil volatility had been amplified in recent weeks amid Houthi drone attacks on Saudi oil facilities.
