Sonali Paul

(Reuters] Oil prices were higher on Thursday after being shook earlier by Libyan supply disruptions and a slowdown in demand. The International Monetary Fund had cut its global growth forecasts, which caused oil prices to rise.

Futures gained 0.5% to $107.35 per barrel at 0117 GMT. This was a recovery of losses in the session before.

U.S. West Texas Intermediate crude futures rose 41 cents or 0.4% to 102.60 per barrel. This is in addition to the 19 cent increase from the previous session.

Analysts believe market volatility will increase soon. The European Union is still considering a ban against Russian oil in order to prevent it from entering Ukraine. This would be made possible by the European Union weighing an EU ban on Russian oil.

Tobin Gorey, a commodities analyst at Commonwealth Bank, stated that oil and the energy markets in general are facing too many big problems to remain quiet long.

Libya, a member country of OPEC on Wednesday stated that the country lost more than 550,000 barrels daily of oil production due to blocking at export terminals and major fields.

As China, the largest oil importer in the world, slowly lifts the COVID-19 restrictions that had hampered manufacturing and supply chain activity worldwide, the demand outlook for China is still a concern.

On Tuesday, the International Monetary Fund warned of risks to China by reducing its global economic growth forecasts by almost a whole percentage point.

The oil market is still tight, with the Organization of the Petroleum Exporting Countries (OPEC+) and its allies, led by Russia, struggling to reach their production targets. Stockpiles were also down in the week ending April 15. [EIA/S]

It is difficult to see any incremental change overnight. A trajectory that starts from this point will be influenced by whether the UK/U.S. joins them. Stephen Innes (SPI Asset Management managing Director) stated that the ban on Russian oil imports was a good idea.

Eight weeks ago, Russia invaded Ukraine. The European Union nations are looking at ways to compensate for a possible ban on Russian crude oil. But, they have not yet decided on a sixth round of sanctions.