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Title: Oil surges after IEA warns of shortfall in supply

Mar 17, 2022 04:10AM ET

By: AnalysisWatch

Oil prices rose about 3% on Thursday after the International Energy Agency (IEA) said markets could lose three million barrels per day (BPD) of Russian crude and refined products by April.

The supply loss would be far greater than the expected one-million-barrel-per-day drop in demand triggered by higher fuel prices, the IEA said in a report on Wednesday.

Benchmark Brent crude futures were up $3, or 3.1 percent, at $101.09 per barrel as of 04:44 a.m. ET, after falling for three days in a row.

West Texas Intermediate crude in the United States was up $2.8, or 3%, to $97.84 per barrel.

Both contracts had weakened the previous day following an unexpected rise in US crude inventories and signs of progress in peace talks between Russia and Ukraine.

Prices had softened in the previous session following news that oil inventories in the United States rose by 4.3 million barrels in the week to March 11, according to the U.S. Energy Information Administration.

The oil market reacted largely calmly on Wednesday to the expected quarter-point increase in interest rates by the Federal Reserve.

Market sentiment was lifted somewhat after China pledged measures to boost financial markets and economic growth, while a drop in new COVID-19 cases in China fuelled hopes that authorities could lift travel bans and allow factories to resume production in sealed-off cities.

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