Oil prices increased marginally on Friday, rebounding from their lowest levels since February, as supply concerns were offset by predicted falls in gasoline demand. Brent crude was up 39 cents, or 0.4%, to $94.51 a barrel at 0900 GMT.
Prices fell this week as the market worried about the impact of inflation on economic development and demand, but indicators of restricted supply kept prices stable. Global crude oil markets remained firmly in backwardation, with immediate prices higher than future month prices, indicating somewhat constrained supplies. Concerns about supply are anticipated to rise as winter approaches, with European Union restrictions prohibiting seaborne imports of Russian crude and oil products slated to take effect on December 5.
According to CMC Markets analyst Tina Teng, with the EU suspending seaborne Russian imports, the major question is whether Middle Eastern producers would reroute their barrels to Europe to fill the hole “RBC analyst Michael Tran stated. “If commodities are not pricing in an impending economic downturn, they may be preparing for a stagflation period in which unemployment rises but inflation remains high.