By Adedapo Adesanya
Oil edged higher on Friday, bolstered by the prospect of lower Russian exports but pressured by rising inventories in the United States and concerns over global economic activity.
Brent crude futures were up 31 cents or 0.4 per cent to $82.75 a barrel, while the Us West Texas Intermediate (WTI) crude futures gained 37 cents or 0.5 per cent to settle at $75.76.
The benchmarks logged a second straight week of decline, losing less than 1 per cent this week.
The market had dropped earlier but made some recoveries as it continued to buzz on Russia’s plans to cut oil exports from its western ports by up to 25 per cent in March, which exceeded its announced production cuts of 500,000 barrels per day.
Friday also marked one year since Russia invaded Ukraine. Since then, the oil market has witnessed some changes, with Brent crude about 15 per cent lower than a year earlier after rising closer to $140 per barrel.
The market appeared to be well supplied, with US inventories at their highest since May 2021, according to data from the US Energy Information Administration (EIA).
Pressure over fears that aggressive rates hike by the US Fed would drive the economy into recession while putting a dent in fuel demand also remained.
Despite this hanging over the market’s head, the worries over Russian supply curbs and the potential for an even tighter supply situation helped offset the negative news.
However, gains were limited by a stronger US Dollar and the sharper-than-expected jump in US inventories. A firm dollar makes commodities priced in the greenback, like oil, more expensive for holders of other currencies.
Also, investment bank JP Morgan said in a note that short-term prices are more likely to drift lower toward the $70s than rise.
This is “as global growth headwinds strengthen and excess ‘dark’ inventory exacerbated by a flooding of Russian oil is worked off,” it said in a note.
The bank also said it expects the Organisation of the Petroleum Exporting Countries (OPEC) to cut production to limit oil price declines.
Europe is on track to import this month the highest volumes of diesel from the Middle East and Asia in seven years as the EU turns to alternative supply after the ban on imports of Russian diesel and other fuels took effect on February 5.
Dipo Olowookere