Oil prices edge up on worries about Russian output and limited OPEC+ production increase

NEW YORK: Oil prices rose about 1% to a one-week high on Wednesday on worries the U.S. and Europe would keep sanctions on Russia for longer due to Moscow’s lack of progress on a peace deal with Ukraine, and on lingering support from the announcement of a smaller-than-expected output hike from the OPEC+ producer group next month.

Brent crude futures rose 86 cents, or 1.3%, to $66.31 a barrel at 11:05 a.m. EDT (1505 GMT), while U.S. West Texas Intermediate (WTI) crude rose 93 cents, or 1.5%, to $62.66.

That put Brent on track for its highest close since September 30 and WTI on track for its highest close since September 29.

In Russia, a top Russian diplomat said the impetus to reach a peace deal with Ukraine, which emerged after a summit between Russian President Vladimir Putin and U.S. President Donald Trump in August, had proven to be largely exhausted.

Analysts have said a peace deal would likely allow more Russian oil to flow to global markets. Russia was the second-biggest crude producer in the world after the U.S. in 2024, according to U.S. energy data.

Despite sanctions, Russia has been gradually raising its oil production and was close last month to meeting its OPEC+ output quota, Deputy Prime Minister Alexander Novak said on Wednesday, the Interfax news agency reported.

Oil slips on OPEC+ output hike, supply glut fears

OPEC+ includes the Organization of the Petroleum Exporting Countries and allies like Russia.

Moscow’s energy sector has been under serious strain in the past two months due to a wave of Ukrainian drone attacks on its oil and gas infrastructure, mainly targeting oil refineries.

Oil markets were up about 2% so far this week after OPEC+ announced a smaller-than-expected output increase for November.

“The bare minimum that OPEC+ decided to get away with on Sunday still provided some support,” PVM oil analyst Tamas Varga said in a note on Wednesday.

OPEC+ agreed to raise its output targets for November by 137,000 barrels per day on growing concerns about a looming glut in the oil market, sources from the group told Reuters.

US oil inventories

Oil markets held gains despite a bigger-than-expected increase in U.S. crude inventories last week.

The U.S. Energy Information Administration said energy firms added 3.7 million barrels of crude into inventories during the week ended October 3.

That compares with the 1.9-million-barrel build analysts forecast in a Reuters poll and the 2.8-million-barrel build market sources said the American Petroleum Institute (API) trade group cited in its figures on Tuesday.