Oil prices moved higher on Thursday after falling for three straight sessions. Earlier declines had been driven by concerns over excess supply in the market. However, renewed fears of tougher sanctions on Russian crude provided some support for prices.
Brent crude futures gained 37 cents, or 0.57%, to trade at $65.72 per barrel by 04:01 GMT. U.S. West Texas Intermediate (WTI) crude climbed 34 cents, or 0.55%, to $62.12 per barrel.
According to analysts, the rebound was partly technical, as Brent and WTI both lost about 1% in the previous session. Brent closed at its lowest level since June 5, while WTI touched its weakest point since May 30.
“Buying interest appeared as WTI approached its $60 support level,” explained Hiroyuki Kikukawa, chief strategist at Nissan Securities Investment. He added that rising geopolitical tensions and speculation about tighter sanctions on Russian crude also contributed to the gains.
On Wednesday, finance ministers from the Group of Seven (G7) nations pledged to increase pressure on Russia. They announced new measures targeting buyers of Russian oil and companies helping Moscow circumvent existing sanctions.
Meanwhile, two U.S. officials confirmed that Washington will provide Ukraine with intelligence for long-range missile strikes against Russian energy infrastructure. This includes refineries, pipelines, and storage facilities. The aim is to reduce the Kremlin’s revenue from oil exports, according to a Wall Street Journal report.
Strong crude demand from China, the world’s biggest oil importer, also helped stabilize prices. Traders said Chinese stockpiling limited the downside, even as other factors capped gains.
However, a looming U.S. government shutdown raised concerns about global economic growth. Expectations of higher output from OPEC+, the alliance of the Organization of the Petroleum Exporting Countries and its partners, also weighed on sentiment. Kikukawa noted these risks prevented oil from rallying further.
President Donald Trump’s administration intensified the shutdown standoff by freezing $26 billion in funding for Democratic-leaning states, adding to political uncertainty.
Looking ahead, OPEC+ may increase production by up to 500,000 barrels per day in November. This would be triple the output hike seen in October, as Saudi Arabia looks to regain market share, according to three sources close to the talks. The decision would come at a time when both U.S. and Asian demand is starting to weaken.
Finally, U.S. government data showed oil inventories rising. The Energy Information Administration (EIA) reported crude stocks increased by 1.8 million barrels to 416.5 million in the week ending September 26. Analysts had expected a smaller build of 1 million barrels. Gasoline and distillate inventories also rose as demand slowed and refining activity eased.
