On Wednesday, Crude oil prices extended their rally as supply disruption concerns increased following severe sanctions on key exporter Russia.
The Brent crude futures surged 5.60% or 5.94 points to $110.91 per barrel. The international benchmark rose as much as $113.02, the highest since 2014.
Similarly, contracts in West Texas Intermediate (WTI) crude hiked 5.50% or 5.62 points to $109.03 per barrel.
The upturn ignored news that several countries plan to release 60.00 million barrels of strategic petroleum reserves to cool prices.
Specifically, the International Energy Agency members agreed on Tuesday to deliver 4.00% of the emergency stockpiles they hold.
At present, the Moscow oil trade is in disarray after many nations imposed sanctions on Russian companies, banks, and individuals.
Eventually, the intensifying Ukraine conflict caused traders to scramble to seek alternative oil sources in an already tight market.
On Tuesday, Exxon Mobil announced its plans to exit Russia’s oil and gas operations as a response to Moscow’s invasion.
This corporate move will pull out extensive production facilities on Sakhalin Island, the largest in the country.
The decision followed the steps of British energy giants Shell plc and BP, Russia’s biggest foreign investor.
At the same time, American traders and the United States Gulf Coast shunned the Russian crude.
Moreover, US President Joe Biden warned Russia’s leader Vladimir Putin in his State of the Union speech.
Furthermore, Bharat Petroleum Corp., a State-run Indian refiner, now seeks extra oil from Middle Eastern producers for April.
The gas company feared that the Western sanctions against Russia could hit deliveries of Urals crude.
Correspondingly, leading oil exporter, Saudi Arabia could sharply hike crude prices for Asia next month.
Crude Oil prices soar ahead OPEC+ meeting
Against that backdrop, the Organization of the Petroleum Exporting Countries, Russia and allies (OPEC+) will meet later this day.
However, analysts expected the body to stick to adding 400,000 barrels per day of supply each month modestly.
Meanwhile, the United States anticipated the OPEC+ to increase the output amid the widening sanctions on Moscow.
Nevertheless, the organization has still 2.60 million bpd of cuts that it projects to unwind by the end of September.
Accordingly, this likely decision will underscore tightness in the market amid the fear of supply disruptions.
The American Petroleum Institute reported that crude inventories fell by 6.10 million barrels for the week ended February 25.
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