After Rising Over 7% On Monday, Crude Oil Prices Soars Over 2% To Near $120 A Barrel

The rise in rates is due to apprehensions of more supply disruptions weighed on the market, mostly because of the ongoing Russia-Ukraine conflict

The International Energy Agency said about 30 lakh barrels per day of Russian crude and products would be off the market by April. Image: Getty

New Delhi: Crude oil prices extended their gains, surging over 2 per cent to near $120 a barrel early on Tuesday after closing over 7 per cent higher in the previous session, as reported by Reuters.

The rise in rates is due to apprehensions of more supply disruptions weighed on the market, mostly because of the ongoing Russia-Ukraine conflict.

According to the Reuters report, Brent futures were last up 2.4 per cent to $118.48 a barrel on the Intercontinental Exchange after having risen more than 7 per cent on Tuesday, tracking news that is going to weigh on the already-tight supply market.

Some European Union members are considering imposing sanctions on Russian oil.

Whereas attacks on Saudi oil facilities sent jitters through the market, keeping supply concerns to persist, with long oil and commodities positions the most crowded trades again on Tuesday.

The International Energy Agency said about 30 lakh barrels per day of Russian crude and products would be off the market by April.

While the latest report from the Organization of the Petroleum Exporting Countries and allies, including Russia (OPEC+), showing some producers are still falling short of their agreed supply quotas, has added to investors’ anxiety.

Analysts for the Commonwealth Bank of Australia wrote in a note, “The proposed ban is still some way from becoming policy because many EU nations oppose the ban,” while adding, “Still, the fact that the ban is being discussed is a significant shift.”

At the same time, Saudi has warned it would not bear responsibility for disruptions to global oil supply following attacks its oil facilities by Iranian-aligned Houthis.

The comments came after the group fired missiles and drones at Saudi oil facilities over the weekend, causing a temporary decline in refinery output. For India, a country which is dependent on oil imports for about 85 per cent of its needs, this is a bad news.

State-run companies raised retail fuel prices for the first time on Tuesday after a 4-month break and cooking gas prices were hiked by Rs 50 per cylinder for the first time since early October.