2023-09-21 17:55:00
Oil prices rebounded on Thursday after Russia announced curbs on its gasoline and diesel exports, reigniting market fears of a supply shortage for both crude and derivatives, according to AFP.
Oil rigPhoto: Dan Bannister / ImageSource / Profimedia
By 15:40 GMT, Brent North Sea crude for November delivery was up 0.42% at $93.92.
Its US counterpart, a barrel of West Texas Intermediate (WTI) for delivery in the same month, which is used as a benchmark contract for the first time, rose 0.70% to $90.29.
“Oil prices were poised for further declines, but Russia’s sudden decision to impose (restrictions on) gasoline and diesel exports pushed oil prices higher,” commented Edward Moya, an analyst at Oanda.
Galloping rise in prices in Russia
On Thursday, the Russian government introduced restrictions on the export of petrol and diesel, in the face of soaring prices that are increasingly affecting Russians’ incomes.
“The government has introduced temporary restrictions (…) to stabilize the domestic market,” the Russian government announced in an official statement, without specifying for how long.
After getting used to the extension until the end of the year of the 300,000 bpd cut in Russian crude exports, the market “now has to deal with the uncertainty of the duration of this temporary ban” on oil products, Moya pointed out.
“Russian diesel exports account for about 1 million barrels per day, or 16% of seaborne deliveries, while the share of gasoline is much smaller, around 3%,” Giovanni Staunovo, an analyst at UBS, told AFP .
“The appreciation of the dollar is limiting the current rise in oil prices, as it is accompanied by a deterioration in the outlook for Europe,” said Edward Moya.
On Wednesday, the Fed kept interest rates at their current level, in a range of 5.25% to 5.50%, but is considering another hike until the end of 2023.
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