Russia’s escalation in Ukraine could impact global oil prices

Russia has announced plans to intensify its strikes on Ukraine, a development that is likely to have significant implications for global oil markets. At present, the West Texas Intermediate (WTI) crude oil price has dipped 0.59% to $89.85 per barrel.

WTI oil is a benchmark for the oil market, known for its high quality and low sulfur content. Its price is influenced by various factors, including global economic growth, political instability, and decisions made by the Organization of the Petroleum Exporting Countries (OPEC). The value of the US dollar also plays a crucial role, as oil is predominantly traded in dollars.

Weekly oil inventory reports from the American Petroleum Institute (API) and the Energy Information Agency (EIA) provide key insights into supply and demand dynamics. These reports, published on Tuesdays and Wednesdays respectively, often show similar results and have a notable impact on oil prices.

OPEC, comprising 12 major oil-producing nations, holds twice-yearly meetings to set production quotas. The decisions of OPEC and its expanded group, OPEC+, which includes Russia, can significantly affect WTI oil prices. Any tightening of supply tends to push prices up, while increased production has the opposite effect.