Oil rises on supply tightness despite “constructive” Ukraine-Russia talks

Oil rises on supply tightness despite “constructive” Ukraine-Russia talks

PHOTO

MELBOURNE: Oil prices climbed on Wednesday, erasing losses from the previous session, on hopes of progress in peace talks between Russia and Ukraine and providing a fresh reminder supply remains tight as data showed U.S. crude stocks fell sharply last week.

Brent crude futures touched a high of $112.78 shortly after opening and were up $1.35, or 1.2%, at $111.58 at 0005 GMT, reversing a 2% loss in the previous session.

U.S. West Texas Intermediate (WTI) crude futures jumped $1.29, or 1.2%, to $105.53 a barre, erasing a 1.6% drop on Tuesday.

The focus turned to supply tightness 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 had dropped about 2% in the previous session after Russia promised to scale down military operations around Kyiv and another city, more than a month after the invasion of Ukraine that Moscow calls a "special operation" to disarm its neighbour.

However, reports of attacks continued, and although Ukrainian President Volodymyr Zelenskiy said there were promising signs from peace talks held in Istanbul on Tuesday, he was