# Oil gains as Russian supply cuts temper concerns over rate hikes, high stocks
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2023-02-24
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: Oil prices rise as Russian supply cuts offset rate hike concerns
Meta Description: Oil prices rise as Russia cuts exports, overshadowing US inventory increases. Brent crude up 0.8% to $82.88, WTI up 0.8% to $76.00. Expectations of lower
URL: https://financedigest.com/oil-gains-as-russian-supply-cuts-temper-concerns-over-rate-hikes-high-stockshtml

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Oil gains as Russian supply cuts temper concerns over rate hikes, high stocks

By Andrew Hayley

BEIJING (Reuters) -Oil prices extended gains for a second session on Friday as the prospect of lower exports from Russia offset rising inventories in the United States.

Brent crude futures rose 67 cents, or 0.8%, to $82.88 per barrel by 0415 GMT. West Texas Intermediate crude futures (WTI) rose 61 cents, or 0.8%, to $76.00 a barrel.

The benchmarks ended about 2% higher in the previous session on Russia’s [plans to cut](https://www.financedigest.com/inpost-sees-better-margin-in-poland-plans-no-job-cuts-this-year.html "InPost sees better margin in Poland, plans no job cuts this year") oil exports from its western ports by up to 25% in March which exceeded its announced production cuts of 500,000 barrels per day.

“Higher-than-expected U.S. crude [oil inventories continue to challenge the oil demand](https://www.financedigest.com/oil-gains-after-iea-sees-demand-rising-to-record-high.html "Oil gains after IEA sees demand rising to record high") outlook, but expectations for lower Russian production have an offsetting impact,” said Yeap Jun Rong, a market strategist at IG.

U.S. inventories are at their highest [level since](https://www.financedigest.com/optimism-levels-drop-to-low-of-17-percent-according-to-first-survey-since-banking-regulations.html "Optimism levels drop to low of -17 percent, according to first survey since banking regulations") May 2021.

U.S. [crude stocks](https://www.financedigest.com/oil-dips-after-fed-comments-us-crude-stock-build.html "Oil dips after Fed comments, US crude stock build") rose by 7.6 million barrels to about 479 million barrels in the week to Feb. 17, data from the U.S. Energy Information Administration said. \[EIA/S\]

For the week, oil prices are slightly lower, after the previous week’s about 4% declines, dragged also by concerns about rising interest [rates that could strengthen the dollar](https://www.financedigest.com/wall-street-slips-dollar-gains-as-fed-seen-hiking-rates-in-may.html "Wall Street slips, dollar gains as Fed seen hiking rates in May").

Minutes from the latest U.S. Federal [Reserve meeting indicated that a majority of officials remained hawkish on inflation](https://www.financedigest.com/oil-prices-dip-on-u-s-crude-reserve-release-inflation-pressure.html "Oil prices dip on U.S. crude reserve release, inflation pressure") and tight labour market conditions, signalling further monetary tightening.

The prospect of further rate hikes supported the dollar index, which was [set for a fourth straight week of gains](https://www.financedigest.com/european-shares-set-for-weekly-gain-on-u-s-inflation-outlook.html "European shares set for weekly gain on U.S. inflation outlook"). The index is now up about 2.5% for the month. \[FRX/\]

A [firm dollar makes commodities](https://www.financedigest.com/sp-global-acquires-firm-to-bolster-capability-to-track-commodity-shipments.html "S&P Global acquires firm to bolster capability to track commodity shipments") priced in the greenback more expensive for holders of other currencies.

The [focus as we close the week will be on what happens with next inflation](https://www.financedigest.com/oil-rises-about-2-with-u-s-and-china-inflation-in-focus.html "Oil rises about 2% with U.S. and China inflation in focus") report, will the market get more nervous on even more tightening from the Fed,” OANDA analyst Edward Moya said.

(Reporting by Andrew Hayley; Additional reporting by Jeslyn Lerh; Editing by Himani Sarkar)


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