Following a 1% decline the previous day, oil prices rose on Thursday as worries about supply shortages over the next winter season outweighed concerns about a possible worldwide recession.
By 0319 GMT, Brent crude futures had increased by 50 cents, or 0.6%, to $90.33 per barrel, recovering some of the losses they had suffered in early Asian trading. U.S. West Texas Intermediate (WTI) crude increased 45 cents to $83.39 per barrel.
Following the U.S. Federal Reserve’s third 75 basis point increase in interest rates to control inflation and signal that borrowing prices would continue to rise this year, both benchmarks on Wednesday reached a level that was almost two weeks low.
They claimed that on Wednesday, Russian President Vladimir Putin mobilized 300,000 reserve soldiers to fight in Ukraine and supported a proposal to acquire territory, escalating the conflict and raising the possibility of a geopolitical breakaway.
In the meantime, several Chinese refineries are considering boosting their production in October in anticipation of increased demand and a potential change in Beijing’s policy on fuel exports, which might increase the demand for crude oil.
But because of inventory stock builds and a deteriorating economic outlook, oil prices continue to be under selling pressure, according to Citi analysts. Increases in oil prices were also restrained by the rising dollar, which is making petroleum more expensive for many consumers.
On Wednesday, the dollar index versus a basket of other currencies reached a 20-year high. In other news, Germany on Wednesday nationalized gas importer Uniper (UN01.DE), while Britain announced it will cut business energy costs in response to a worsening supply problem that has shown Europe’s dependency on Russian fuel.
