West Texas Intermediate (WTI) New York crude futures closed higher on Friday (Dec. 23) on reports that Russia would cut exports of Baltic crude. The news overshadowed any negative factors that cold weather in the US could have on fuel demand this holiday season.
The WTI Crude Oil contract is delivered in February. It rose $2.07, or 2.6%, to close at $79.56 a barrel and was up 6.9% for the week.
The contract for Brent crude oil (BRENT) is delivered in February. it rose $2.94, or 3.63%, to close at $83.92 a barrel. and up 6.2% this week.
Crude oil futures rose after Reuters news agency reported that Crude oil exports from Russia’s Baltic region are expected to fall 20% in December from November levels. After the European Union (EU) and G7 countries imposed sanctions and control over the price ceiling of Russian oil from December 5th.
The news boosted oil prices. and overshadow the negative factors from news reporting US airlines cancel more than 4,400 flights due to snowstorm Demand for travel this holiday season has slowed as a result.
Oil prices are also gaining momentum from the US plan to buy oil to put in the strategic reserve (SPR), as well as hopes that China will reopen the country. After the measures to control the COVID-19 will be relaxed.
The official Russian news agency RIA reported on Friday Russian Deputy Prime Minister Alexander Novak said Russia could reduce its oil production by 5%-7% in early 2023 in response to measures to limit crude and petroleum products by cutting off sales to countries that support it.
Also, global oil supply may be more limited. Because OPEC Plus started cutting production by 2 million barrels a day from November this year until the end of 2023.