The oil prices in Nigeria increased by more than 1 percent on Friday, 7 May and were geared up to increase for a second consecutive week, shrugging off worries regarding worldwide economic growth as upcoming European Union sanctions on Russian oil raised the prospect of tighter supply.
Brent futures increased $1.43, or 1.3%, to $112.31 per barrel by 1:24 p.m. ET (1618 GMT), whereas U.S. West Texas Intermediate (WTI) crude rose $1.50, or 1.4%, to $109.77 a barrel.
Phil Flynn, an analyst at Price Futures Group, said, “In the nearest term, the fundamentals for oil are bullish, and it is only worries of an economic deceleration in the future that is holding us back.”
WTI was on its path to gaining around 6%, and Brent was set to rise around 4% this week after the EU carried out an embargo on Russian oil as part of its toughest to date package of sanctions against the Russians over the dispute in Ukraine.
The EU sanctions bid includes phasing out all imports of Russian refined goods by the end of this year, as well as a ban on all shipping and insurance services for the transportation of Russian oil.
The EU is nipping its sanctions plan, which requires unanimous backing from all the 27 nations in the bloc, in an offer to win over reluctant states, told three EU sources on Friday.
Stephen Brennock, the PVM analyst, said, “The coming EU embargo on Russian oil has the makings of a critical supply squeeze. In any case, OPEC+ is in no mood to help out, even as rallying energy costs prompt destructive inflation levels.”
Ignoring calls from Western nations to hike output more, the Organization of the Petroleum Exporting Countries, Russia and allied producers, a group known as OPEC+, adhered with its plan to raise its June output target by almost 432,000 barrels per day.