Oil Prices Steady After Rise
2022.05.12 06:31
By David Ho
Investing.com – Oil was down on Thursday morning in Asia as prices steadied after an initial rise from Russia placing sanctions on some European gas companies.
Brent oil futures fell 1.00% to $106.44 by 11:01 PM ET (3:01 AM GMT) and crude oil WTI futures slipped 0.99% to $104.66.
On Wednesday, Russia countered by sanctioning 31 companies from countries that imposed sanctions on Moscow when Russia invaded Ukraine in February.
The events have created unease in the market as Russian gas flows to Europe via Ukraine fell by a quarter. It marked the first time exports via Ukraine have been disrupted since the invasion.
Prices have risen over 35% so far this year, as concerns over supply rose.
The European Union is negotiating an embargo on Russian oil, which analysts say would further tighten the market and shift trade flows. But the vote needs unanimous support, and Hungary has opposed it.
Price gains have also been capped by worries about a fall in demand from China, as it attempts to curb the spread of the coronavirus through lockdowns.
“Until we see some significant policy support coming through in China or policymakers adopt an alternative strategy to COVID (which seems very unlikely), oil prices could remain capped near term,” said Stephen Innes, managing partner at SPI Asset Management.
