Crude Oil Prices remains above $69.00 due to growing supply concerns over the Russia-Ukraine conflict
- WTI price receives support from growing supply concerns due to rising geopolitical tensions.
- Kremlin warned to retaliate if Ukraine use Army Tactical Missile Systems (ATACMS).
- Norway’s Equinor announced a production halt at its Johan Sverdrup Oilfield due to an onshore power outage
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The West Texas Intermediate (WTI) Oil price is trading at approximately $69.20 per barrel during Asian hours on Tuesday, continuing to expand its gains for the second consecutive session. In response to the escalating supply concerns regarding the Russia-Ukraine conflict, crude oil prices have experienced an increase in support. Ukraine’s electrical infrastructure sustained substantial damage as a result of Russia’s largest airstrike in nearly three months on Sunday.
On Sunday, US President Joe Biden granted Ukraine the authority to employ Army Tactical Missile Systems (ATACMS), which are sophisticated, long-range American weapons, to execute assaults within Russia. Two United States officials were cited by CNN.
In response, the Kremlin issued a warning on Monday that it would retaliate against the Biden administration’s “reckless” action. Russia had previously issued a warning that such actions could increase the likelihood of a confrontation with NATO.
Equinor, the largest oilfield in Western Europe, announced a production suspension at its Johan Sverdrup Oilfield in response to an onshore power outage. This announcement provided support to crude oil prices. The company has initiated efforts to resume production; however, the timeline for resumption is uncertain, as reported by Reuters.
Last week, crude oil prices experienced downward pressure as a result of Federal Reserve Chair Jerome Powell’s decision to temper expectations for near-term rate decreases. Powell underscored the economy’s resilience, a robust labor market, and persistent inflationary challenges. The oil prices have been further impacted by concerns about weakening demand in China, the world’s largest oil importer, which has contributed to the bearish sentiment.
