Oil settles up ahead of U.S. driving season, EU embargo decision

Technicians stand subsequent to an oil rig at an Oil and Pure Gasoline Corp (ONGC) plant, throughout a media tour of the plant in Dhamasna village within the western state of Gujarat, India, August 26, 2021. REUTERS/Amit Dave

HOUSTON, Might 27 (Reuters) – Oil costs rose on Friday, closing out the week with positive aspects forward of the U.S. Memorial Day vacation weekend, the beginning of peak U.S. demand season, and as European nations negotiate over whether or not to impose an outright ban on Russian crude oil.

Brent crude rose $2.03, or 1.7%, to settle at $119.43. U.S. West Texas Intermediate (WTI) crude rose 98 cents, or 0.9%, to settle at $115.07 a barrel. For the week, Brent rose 6% whereas WTI gained 1.5%.

Costs drew assist from sturdy worldwide demand for gasoline, with each gasoline and heating oil futures outpacing crude this 12 months.

“Demand is powerful with merchandise main the way in which, particularly gasoline which dragged crude oil up with it,” mentioned John Kilduff, a accomplice at Once more Capital LLC.

“The U.S. driving season and robust journey demand ought to assist (costs). With provide progress lagging demand progress, the oil market is more likely to keep undersupplied. Therefore, we stay constructive in our outlook for crude costs,” mentioned UBS analyst Giovanni Staunovo.

European Union international locations are negotiating a deal on Russian oil sanctions that might embargo cargo deliveries however delay sanctions on oil delivered by pipeline to win over Hungary and different landlocked member states, officers mentioned. learn extra

Hungary’s resistance to grease sanctions and reluctance of different international locations have held up implementation of a sixth package deal of sanctions by the 27-member EU towards Russia following its invasion of Ukraine.

EU authorities envoys might attain an settlement in Brussels on Sunday in time for leaders to endorse it at their Might 30-31 summit, officers mentioned. learn extra

Iranian forces seized two Greek oil tankers on Friday within the Persian Gulf, which has additionally made buyers cautious of being quick going into the weekend, mentioned Phil Flynn, an analyst at Value Futures Group.

“We’re seeing assumptions that the demand for oil and gasoline could also be stronger because the inventory market means that fears of a recession could also be being overplayed,” Flynn mentioned.

Russian President Vladimir Putin instructed Austrian Chancellor Karl Nehammer that Moscow would meet its pure gasoline supply commitments. learn extra

Reporting by Marcy de Luna in Houston, extra reporting by Bozorgmehr Sharafedin in London, Stephanie Kelly in New York; Enhancing by Diane Craft, Kirsten Donovan and David Gregorio

: .