Oil Prices Rise Amid Supply Disruptions and Ukraine Talk Expectations

Houston, Texas - Oil prices saw a modest increase on Wednesday due to supply disruptions in the United States and Russia, as well as market anticipation for updates on peace negotiations in Ukraine.

Brent Crude futures gained 0.3% or $0.20 to reach $76.04 per barrel at 0146 GMT, continuing a three-day upward trend.

U.S. West Texas Intermediate (WTI) crude futures for March delivery rose 0.3% or $0.23 to $72.08 per barrel, marking a 1.7% increase since Friday's close. The contract expires on Thursday, while the more active April contract gained 0.3% to $72.04.

Russia's CPC Pipeline

Flows through the Caspian Pipeline Consortium (CPC) experienced a 30%-40% reduction on Tuesday after a Ukrainian drone attack on a pumping station. The CPC is a major export route for Kazakh crude, and a 30% cut would mean a loss of approximately 380,000 barrels per day.

U.S. Cold Weather Impact

Extreme cold weather in the United States posed a threat to oil production, with the North Dakota Pipeline Authority estimating a potential decline of up to 150,000 bpd in the state, which is the third-largest oil producer in the country.

Ukraine Peace Talks

U.S. President Joe Biden's administration announced plans for further talks with Russia to resolve the conflict in Ukraine. A potential agreement could potentially ease or lift sanctions that have hindered Russian oil exports.

Tariffs and Demand

President Biden also indicated on Tuesday his intention to impose tariffs on automobiles (around 25%) and import duties on semiconductors and pharmaceuticals. These tariffs could lead to higher consumer prices, economic weakness, and reduced fuel demand.