Oil prices rose more than $1 on Monday, recovering part of last week’s losses. The gains were fueled by the prospect of new sanctions on Russian crude after a major overnight strike on Ukraine.
At 06:40 GMT, Brent crude climbed $1.24, or 1.9%, to $66.74 per barrel, while U.S. West Texas Intermediate (WTI) gained $1.17, or 1.9%, to $63.04. Both benchmarks had dropped over 2% on Friday after weak U.S. jobs data raised concerns about slowing energy demand. They also lost more than 3% over the course of last week.
OPEC+ Output Hike Remains Modest
OPEC+, which includes OPEC members, Russia, and other allies, announced plans on Sunday to raise oil production again from October. However, the increase was smaller than expected.
Eight OPEC+ members will boost output by 137,000 barrels per day (bpd) in October. This compares to much larger hikes of 555,000 bpd in August and September and 411,000 bpd in June and July. Analysts said the modest move supported market sentiment, especially after weeks of price declines.
Toshitaka Tazawa of Fujitomi Securities noted that the smaller hike was already priced in, while expectations of tighter supply from potential U.S. sanctions on Russia gave prices an extra lift.
Russia-Ukraine War Adds Pressure
U.S. President Donald Trump said on Sunday he was ready to move to a second phase of sanctions against Russia, the strongest signal yet that tougher measures could soon be imposed. Analysts warned that sanctions targeting buyers of Russian oil could disrupt global supply chains.
Over the weekend, Russia carried out its largest air attack of the war on Ukraine, setting fire to a key government building in Kyiv and killing at least four people, according to Ukrainian officials. Trump also confirmed that European leaders will travel to Washington this week to discuss possible solutions to the conflict.
Satoru Yoshida of Rakuten Securities said oil prices were lifted by the smaller-than-expected OPEC+ supply hike as well as concerns that Russian oil will not flood the market.
Market Outlook
Goldman Sachs noted in a weekend report that global oil markets may face a slightly larger surplus in 2026, as supply growth in the Americas offsets weaker Russian output and stronger demand. The bank kept its Brent and WTI forecasts for 2025 unchanged, while projecting average prices in 2026 at $56 and $52 per barrel respectively.
