Crude rises as new sanctions on Russia outweigh demand concerns



File image of tankers docked at a terminal of the Sinopec Yaogang oil depot in Nantong, China.


© Archyde.com/China Stringer Network
File image of tankers docked at a terminal of the Sinopec Yaogang oil depot in Nantong, China.

By Noah Browning

LONDON, April 6 (Archyde.com) – Crude futures rose on Wednesday as the threat of new sanctions on Russia heightened supply concerns, offsetting fears of weaker demand after a build-up in stocks in the United States and the prolonged lockdown in Shanghai.

* By 1130 GMT, Brent crude futures were up $1.01, or 0.95%, at $107.67 a barrel, while U.S. West Texas Intermediate (WTI) futures were up $1.38. , or 1.35%, to $103.33.

* Washington and its allies were preparing new sanctions against Moscow for the massacres of civilians in Ukraine, which President Volodymyr Zelenski called “war crimes.” Russia denies targeting civilians.

* “With allegations mounting and new Western sanctions against Russia in the pipeline, more Russian economic retaliation seems inevitable,” said Sophie Lund-Yates of Hargreaves Lansdown.

* “These concerns have undoubtedly fueled the upward trend in oil prices, and volatility is expected to continue as the geopolitical situation unfolds,” he added.

* Growing supply concerns erased earlier price declines due to the strong dollar, which makes foreign currency holders more expensive a barrel, and the unexpected rise in US oil reserves.

* Demand concerns also grew after authorities in top oil importer China extended a lockdown in Shanghai to cover the financial hub’s 26 million residents.

(Reporting by Noah Browning and Yuka Obayashi; Spanish editing by Carlos Serrano)

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