# Oil rises on tight supplies; trade choppy on demand worries Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2022-06-13 Category: INVESTING Category URL: https://financedigest.com/category/investing Meta Title: Oil prices rise on tight global supply despite demand fears Meta Description: Stay updated on the latest developments in the oil market. Volatile trade, tight supplies, COVID-19 impact, and more influencing factors explained here! URL: https://financedigest.com/oil-rises-on-tight-supplies-trade-choppy-on-demand-worrieshtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2022-06-13t011420z2lynxmpei5c00vrtroptp4argentina-economy-energy-1736815649295-compressed.jpg) By Stephanie Kelly NEW YORK (Reuters) – Oil prices rose on Monday in a session of volatile trade, as tight global supplies outweighed worries that demand would be pressured by a flare-up in COVID-19 cases in Beijing and more interest rate hikes. Brent crude rose 68 cents to $122.69 a barrel at 12:13 p.m. EDT (1613 GMT). U.S. West Texas Intermediate crude rose 61 cents to $121.28 a barrel. [Trade was volatile](https://www.financedigest.com/the-benefits-of-social-trading-in-a-volatile-market.html "The benefits of social trading in a volatile market"), with prices down about $3 a barrel earlier. Oil [supplies are tight](https://www.financedigest.com/ceraweek-europe-gas-supplies-to-stay-tight-2-more-winters-equinor-ceo-says.html "CERAWEEK-Europe gas supplies to stay tight 2 more winters, Equinor CEO says"), with OPEC and allies unable to fully deliver on pledged output increases because of a lack of capacity in many producers, sanctions on Russia, and unrest in Libya that has slashed output. Oil has surged in 2022 as Russia’s invasion of Ukraine compounded supply concerns and as [demand recovered from COVID](https://www.financedigest.com/merck-kgaa-expects-2023-profit-to-slip-as-covid-demand-wanes.html "Merck KGaA expects 2023 profit to slip as COVID demand wanes") lockdowns. In [March Brent hit](https://www.financedigest.com/u-s-oil-exports-to-europe-hit-record-in-march-on-steep-discounts.html "U.S. oil exports to Europe hit record in March on steep discounts") $139, the highest since 2008. Last week, both oil benchmarks rose more than 1%. We were struggling with the Russian loss (of oil) so now add an exclamation point with the Libyan situation,” said Robert Yawger, executive director of [energy futures](https://www.financedigest.com/the-future-of-finance-in-the-energy-industry.html "The future of finance in the energy industry") at Mizuho. On Saturday, the [average price](https://www.financedigest.com/taylor-wimpey-espana-remain-cautiously-optimistic-as-average-selling-price-increases-by-20-4.html "Taylor Wimpey España ‘remain cautiously optimistic’ as average selling price increases by 20.4%") of U.S. gasoline exceeded $5 a gallon for the first time, data from the AAA showed. Prompting [demand concerns](https://www.financedigest.com/oil-falls-on-concerns-economic-slowdown-may-dent-fuel-demand.html "Oil falls on concerns economic slowdown may dent fuel demand"), Beijing’s most populous district Chaoyang announced three rounds of mass testing to quell a “ferocious” COVID-19 outbreak. “We don’t know what’s going to happen with China. The mood is dour right now,” said Phil Flynn, analyst at Price Futures. [Concern about further rate hikes](https://www.financedigest.com/shares-fall-with-oil-prices-amid-concerns-about-u-s-fed-rate-hikes.html "Shares fall with oil prices amid concerns about U.S. Fed rate hikes"), heightened by Friday’s U.S. [inflation data](https://www.financedigest.com/oil-jumps-on-lower-than-expected-us-inflation-data.html "Oil jumps on lower-than-expected US inflation data") showing the consumer price index rose 8.6% last month, also pressured oil lower. \[MKTS/GLOB\] Other financial markets fell too, as [investors worried](https://www.financedigest.com/uk-stocks-slip-as-rate-hike-worries-grip-investors.html "UK stocks slip as rate hike worries grip investors") the Federal Reserve may tighten policy too aggressively and cause a sharp slowdown. The S&P 500 was on track to confirm a [bear market](https://www.financedigest.com/protecting-stock-portfolios-in-a-bear-market.html "Protecting Stock Portfolios in a Bear Market"). The next [Fed policy decision](https://www.financedigest.com/cyclicals-bat-drag-ftse-100-lower-ahead-of-fed-decision.html "Cyclicals, BAT drag FTSE 100 lower ahead of Fed decision") is on Wednesday. In Europe, Francesco Giavazzi, the closest economic adviser to Italian Prime Minister Mario Draghi, said on Monday that European Central [Bank interest rate hikes were not the right way to curb surging price rises](https://www.financedigest.com/the-rise-of-biometric-technology-in-banking.html "The rise of biometric technology in banking"). (Reporting by Stephanie Kelly; additional reporting by Alex Lawler, Florence Tan and Mohi Narayan; Editing by Kirsten Donovan; Editing by Bernadette Baum and David Gregorio) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---