NEW YORK, Nov 19 (Reuters) – Oil prices remained largely unchanged on Tuesday as escalating tensions in the Russia-Ukraine conflict kept investors wary of potential supply disruptions, while a partial restart of production at Norway’s Johan Sverdrup oilfield capped any significant price gains.
Brent crude futures rose by a cent, settling at $73.31 per barrel, while U.S. West Texas Intermediate (WTI) crude futures increased by 0.3%, or 23 cents, to close at $69.39 a barrel.
The latest escalation in the conflict saw Ukraine for the first time use U.S.-supplied ATACMS missiles to strike Russian territory, a move Moscow condemned. Russian Foreign Minister Sergei Lavrov labeled the attack as a Western escalation, while President Vladimir Putin reduced the threshold for a potential nuclear strike.
“This intensifies tensions in the Russia-Ukraine war and highlights the risk of oil supply disruptions,” noted ANZ Bank analyst Daniel Hynes.
Market observers also noted signs that China, the world’s largest oil importer, is increasing its crude purchases. According to StoneX analyst Alex Hodes, China’s crude imports are on track to end November near record highs, based on data from vessel tracker Kpler. After weak imports earlier this year, which had pressured oil prices and contributed to a 20% decline in Brent futures from their April peak, China’s higher-than-expected imports this month are seen as a positive signal for the market.
Meanwhile, oil’s upward momentum was restrained by the partial restart of production at the Johan Sverdrup field, Western Europe’s largest oilfield, following a power outage the previous day that had contributed to a 3% surge in oil prices.
“The restart of Sverdrup production, along with a stronger U.S. dollar, dampened sentiment,” said Giovanni Staunovo, analyst at UBS.
Additionally, oil prices faced further pressure after reports from the U.N. nuclear watchdog indicated that Iran had offered to halt the expansion of its stockpile of uranium enriched to 60% purity, just shy of weapons-grade levels.
U.S. crude stockpiles rose by 4.75 million barrels in the week ending Nov. 15, according to market sources citing American Petroleum Institute (API) data. Analysts surveyed by Reuters had expected a much smaller increase of around 100,000 barrels. Official data from the U.S. Energy Information Administration (EIA) is set to be released on Wednesday at 10:30 a.m. EST.
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