Oil prices fell on Friday, with some supply concerns alleviated by the partial resumption of exports from Kazakhstan’s CPC crude terminal. At the same time, the European Union remained divided over whether to impose an oil embargo on Russia.
Brent crude (BRN1!) fell $1.29, or 1.1 percent, to $117.74 per barrel at 1049 GMT, while West Texas Intermediate (WTI) crude (CL1!) fell $1.80, or 1.6 percent, to $110.54 after both fell more than 2% the previous session.
Both benchmarks were on track to post their first weekly gain in three weeks despite the drop. Brent was on its way for a 9% increase, while WTI was on track for a 6% increase, as broader supply concerns fueled by Russia’s invasion of Ukraine supported the market.
Concerns arose after the Caspian Pipeline Consortium (CPC) terminal on Russia’s Black Sea coast halted exports due to storm damage.
According to two sources familiar with the process and shipping data on Refinitiv Eikon, the terminal partially resumed oil loadings on Friday.
Both the United States and the United Kingdom, which rely less on Russian oil than the European Union, have imposed bans on Russian crude. The EU, which is heavily reliant on Russian oil and gas, faces a more difficult decision about whether to sanction the sector.
As the sole buyer of Russian oil, the faster Europe seeks to reduce Russia’s imports, and the higher global oil prices will rise.
According to OPEC sources, the producer group’s officials believe that a potential EU ban on Russian oil would harm consumers and have expressed their concerns to Brussels.
Analysts said the market remained vulnerable to any supply shock, despite global stockpiles being at their lowest since 2014.
Prices influenced by the possibility of another coordinated release of oil from storage by the US and its allies to help calm oil markets.
The Intercontinental Exchange (ICE) raised Brent futures margins by 19 percent for the May contract beginning on Friday, the third increase this year, in response to market volatility. When markets are volatile, futures margin rates rise, making transactions more expensive because traders must increase the deposit they hold at the exchange for each contract to demonstrate their ability to deliver on obligations.
To alleviate concerns about gas supply, the US said it would work to ensure additional liquefied natural gas (LNG) volumes for the EU market of at least 15 billion cubic meters in 2022, with future increases expected.
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