Oil rose, extending a gain from last week, as traders weighed moves to crack down on Russian flows against forecasts for a surplus later in the year.
West Texas Intermediate advanced about 1% to trade above $63 a barrel, after adding 1.3% last week. Ukraine is ramping up its attacks on Russia's oil infrastructure, with drones striking the Kinef refinery, one of the nation's largest, over the weekend. The strike comes days after an attack on the key Baltic export port of Primorsk.
US President Donald Trump also reiterated calls that Europe must stop buying oil from Russia, after earlier saying he's prepared to move ahead with “major” sanctions on crude supply from the OPEC+ member if NATO countries do the same.
Oil has traded in a range of about $5 a barrel since early August, with prices buffeted by the competing forces of geopolitical risks and bearish fundamentals, which led hedge funds to cut their bullish position on US crude to the lowest on record. OPEC+ has started to bring back a new tranche of oil production ahead of schedule — leading the International Energy Agency to project a record surplus next year.
The lastest Ukrainian drone attacks “reinforced price support above $61,” said Razan Hilal, market analyst at Forex.com. “While this has kept the bullish narrative intact, the chart does not yet confirm a clean uptrend, as demand risks and trade instability weigh on sentiment — especially as OPEC's recent supply cut unwinds reflect slowdown.”
Traders are now looking ahead to a high-stakes US central bank meeting, where the Federal Reserve is largely expected to resume its interest-rate cutting cycle. A rate cut could spur economic activity and boost oil demand, though market participants are split on to what extent.
Prices:
WTI for October delivery gained 1.2% to $63.42 a barrel at 10:15 a.m. in New York.
Brent for November settlement added 0.9% to $67.62 a barrel.
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