Crude prices bounced back from its biggest loss in three weeks on Monday, as the tensions in Ukraine escalates and the US and European Union warned Russia with new sanctions.
The North American West Texas Intermediate (WTI) crude for May delivery gained 0.70% to $101.30 a barrel on the New York’s Nymex at the time of writing. At the same time the European benchmark Brent crude for June settlement climbed 0.24% higher to $109.95 on the London-based ICE Futures Europe exchange.
The US and European Union are expected to announce further sanctions which is expected to commence today, against Russian companies and individuals close to the Russian President Vladimir Putin, according to a senior US administration official.
Officials from the European Union nations are expected to meet later in the day to put together a list of individuals and companies and impose further sanctions which will include asset freezes and travel bans, according to reports.
“Oil prices are going to be higher this week because of pressures linked to the situation around Russia and Ukraine,” said Robin Mills, the head of consulting at Manaar Energy Consulting and Project Management. “There’s a general concern in markets about the situation.”
Meanwhile in the US, hedge funds cut their net-long positions on the North American West Texas Intermediate crude by 2.3% to 333,791 in the week ending April 22, reports from the Commodity Futures Trading Commission showed.
Investors will be awaiting a string of economic reports in the upcoming weeks, including the outcome from the Federal Open Market Committee meeting scheduled for Wednesday.
Meanwhile the Federal Reserve (Fed) Chair Janet Yellen is expected to deliver a speech on Thursday at the Independent Community Bankers of America’s Annual Policy Summit in Washington DC.
Other economic releases includes the non-farm payrolls figures due Friday, with estimates of 210,000 additional new jobs, compared to the previous figure of 192,000.
Last week, the US Energy Information Administration reported a rise in crude inventories by 3.52 million barrels last week, climbing to an all-time high of 397.7 million.
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