Oil prices rose to their highest level in a week, supported by growing concerns about Russian supplies and rising crude consumption in the United States, as investors awaited the US Federal Reserve's interest rate decisions.
Brent crude futures rose 1.2% to close at $66.25 a barrel , while U.S. West Texas Intermediate crude climbed 1.3% to $62.55 a barrel , marking its highest close since the end of September.
Analysts believe that the stalemate in peace talks between Russia and Ukraine is keeping sanctions in place against Moscow, limiting the flow of Russian oil to global markets and leading to tension in global supplies .
Despite Western sanctions, Moscow continues to gradually increase its production, approaching its quota in the "OPEC+" agreement, amid ongoing Ukrainian attacks on Russian oil refineries.
Conversely, expectations of a US interest rate cut have helped support oil prices, as market forecasts indicate the Federal Reserve could cut interest rates by 25 basis points in October , boosting economic growth and increasing fuel demand.
A report from the U.S. Energy Information Administration (EIA) showed that U.S. oil demand rose to 21.99 million barrels per day —the highest level since December 2022—despite a 3.7 million barrel increase in inventories, indicating strong domestic consumption . Phil Flynn , an analyst at Price Futures, said:
"Demand figures are extremely strong and should keep the market supported over the coming period."
On the other hand, the OPEC+ group decided to raise its production targets for November by only 137,000 barrels per day , in a limited move aimed at maintaining market balance and avoiding a decline in prices amid a slowing global economy.
Thus, oil prices continued their gains for the second week in a row, supported by a combination of geopolitical concerns and positive economic data from the United States , reinforcing expectations of a continued upward trend for crude in the near term.
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