International Business: Oil rebounds on tight supply, prospects of new Russia sanctions – Gulf Digital News

International Business: Oil rebounds on tight supply, prospects of new Russia sanctions – Gulf Digital News

MELBOURNE/BEIJING: Oil prices clawed back heavy losses on Wednesday, amid tight supply and growing prospects of new Western sanctions against Russia even as signs of progress emerged from peace talks between Moscow and Kyiv.

Brent crude futures touched a high of $112.78 shortly after opening and were up 86 cents, or 0.8%, at $111.09 at 0426 GMT, reversing a 2% loss in the previous session.

US West Texas Intermediate (WTI) crude futures gained 82 cents, or 0.8%, to $105.06 a barrel, erasing a 1.6% drop on Tuesday.

"The volatile prices indicate extremely sensitive sentiment among investors," said analysts from Haitong Futures. "People urgently need to see changes to make the market situation clearer."

The focus turned to tight supply after the American Petroleum Institute industry group reported crude stocks fell by 3 million barrels in the week ended March 25, according to market sources.

That was triple the decline that 10 analysts polled by Reuters had expected on average.

The market saw a sharp sell-off in the previous session after Russia promised to scale down military operations around Kyiv but reports of attacks continued.

Commonwealth Bank analyst Tobin Gorey said in a note that "The (price) recovery suggests the oil market, at least, has a strong degree