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Oil Resumes Climb on Ukraine; U.S. Rate Hike, Gasoline Stocks in Shadows  -Breaking

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© Reuters.

By Barani Krishnan

Investing.com — The crude oil rally returned to Tuesday’s high after a two day respite. Concerns about Russia-Ukraine tensions helped the longs keep a positive outlook on the market, in spite of forthcoming U.S. Weekly data showing a further increase in gasoline stocks.

Wall Street’s renewed on U.S. rate hike fears also did not hit the oil market as it did on Monday.  

By 2:33 PM ET (13:13 GMT), the benchmark price for U.S. crude oil was at $85.22 per barrel, an increase of $1.91 or 2.2%. WTI lost 2.2% on Monday.

The London-traded benchmark oil price rose 1.7% to $86.91/barrel, an increase of $1.48. Brent fell 1.8% during the last session.

“The market remains fundamentally bullish and conflict with Russia does nothing to alleviate supply-side pressures,” said Craig Erlam, analyst at online trading platform OANDA. “If anything, the risks are tilted in the other direction.”

Western nations continued to press for a diplomatic outcome on Tuesday to the escalating Russia-Ukraine crisis, even as American troops were placed on “high alert” for possible deployment to Eastern Europe while NATO dispatched additional ships and fighter jets to the region. Moscow repeatedly denies any intention to invade the region and blames Washington. 

Meanwhile, oil traders have seized this opportunity to push prices higher in the war narrative. Crude oil producers from the OPEC+ Alliance also pumped less during the month. This reinforces the idea of an undersupplied marketplace.

In the United States, the world’s No.1 oil consumer, the supply-demand picture for oil has been somewhat different.

Tuesday’s market rebound came ahead of weekly data from the U.S. Energy Information Administration that could be mixed at best.

Ahead of the EIA report, due at 10:30 AM ET (15:30 GMT) on Wednesday, the American Petroleum Institute will issue a snapshot at around 4:30 PM today of what last week’s stockpiles of crude and fuel products could have been.

According to Investing.com’s industry analysts, it is likely that 728,000 barrels were reduced last week compared to the 515k barrels built by the EIA in the prior week.

are expected to have fallen by 1.26 million barrels, adding to the previous week’s decline of 1.43 million.

But likely jumped by 2.54 million barrels, on top of the previous week’s rise of 5.87 million.  In spite of the strong global oil prices, gasoline barrels have risen by an unprecedented 24 million barrels in just three weeks.

 

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