Oil futures rose for a fourth straight session Friday, boosted by supply concerns with the European Union seen moving closer to a full embargo on purchases of Russian crude.
West Texas Intermediate crude for June delivery CL.1 CL00 CLM22 rose 99 cents, or 0.9%, to $106.35 a barrel on the New York Mercantile Exchange, with the U.S. benchmark on track for a 4.1% weekly rise and a 5.9% April gain, based on the most actively traded contract.
June Brent crude
the global benchmark, was up $1.79, or 1.7%, at $109.38 a barrel on ICE Futures Europe. July Brent
the most actively traded contract, was up $1.36, or 1.3%, at $108.62 a barrel, set for a 2.3% weekly rise and a 3.7% monthly advance.
June natural-gas futures
fell 0.3% to $6.972 per million British thermal units.
“The uptick since yesterday is attributable to the increased probability of an EU oil embargo against Russia now that Germany has stopped opposing such a measure,” said Carsten Fritsch, analyst at Commerzbank, in a note. “This change in stance comes as no surprise given that Germany’s Economics Minister Habeck said a few days ago that Germany now imports only 12% of its oil from Russia.”
German representatives to European Union institutions on Thursday lifted objections to a full embargo of Russian supplies provided Berlin was given enough time to find alternative supplies, The Wall Street Journal reported Thursday, citing government officials. Germany, with Europe’s largest economy, has been a key roadblock to an EU embargo linked to Russia’s invasion of Ukraine. The U.S. and U.K. had previously moved to end purchases of Russian oil.
Meanwhile, diesel prices have surged amid tight supplies of distillates on both sides of the Atlantic, Fritsch noted. The U.S. Energy Information Administration on Wednesday reported that distillate inventories dropped by 1.4 million barrels last week, versus forecasts for a decline of just 100,000 barrels.
“Furthermore, the largest Russian oil producer plans in future to demand ruble payments for diesel shipments, which makes a delivery stop likely even if oil products were not affected by an EU embargo,” Fritsch said.