Crude Oil Prices Back Up Close To $110; Volatility To Persist

Oil prices rose early on Friday, now back up close to $110 a barrel, with the see-saw in the news flow on the peace talks between Russia and Ukraine dominating and driving daily trading moves recently.

The whiplash in crude markets was reflected in the oil price moves since Russia's invasion of Ukraine on February 24, during which Brent rose to multi-decade highs of nearly $140 a barrel and fell briefly below $100 a barrel.

The fears of an extended disruption to supply have extended the market volatility into the third week, with the benchmark Brent crude oil up over 2 per cent early on Friday, trading close to $110 per barrel, after surging nearly 9 per cent on Thursday in the most significant percentage gain since mid-2020.

The US crude was up over 2.5 per cent at nearly $106 a barrel, after an 8 per cent jump in the previous session. 

Despite the rebound, both benchmark contracts were set to end the week about 4 per cent lower after having traded in a $16 range. Prices have dropped from 14-year highs hit nearly two weeks ago.

"I'm still expecting more volatility. There's a lot of uncertainty out there still," Justin Smirk, senior economist at Westpac in Sydney, told Reuters.

"In such a tight market and such an illiquid paper market - you're going to get some volatility," Mr Smirk added.