By Yuka Obayashi TOKYO (Reuters) – Oil prices climbed more than $1 on Monday, regaining some of last week’s losses, helped by the prospect of more sanctions on Russian crude after an overnight strike on Ukraine. OPEC+ flagged plans to further increase production from October but the amount was modest. Brent crude climbed $1.24, or […]
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Oil gains on prospect of more sanctions on Russia; OPEC+ output hike seen modest
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By Yuka Obayashi
TOKYO (Reuters) – Oil prices climbed more than $1 on Monday, regaining some of last week’s losses, helped by the prospect of more sanctions on Russian crude after an overnight strike on Ukraine.
OPEC+ flagged plans to further increase production from October but the amount was modest.
Brent crude climbed $1.24, or 1.9%, to $66.74 a barrel by 0640 GMT, while U.S. West Texas Intermediate crude rose $1.17, or 1.9%, to $63.04 a barrel.
Both benchmarks fell more than 2% on Friday as a weak U.S. jobs report dimmed the outlook for energy demand. They lost more than 3% last week.
OPEC+, which includes the Organization of the Petroleum Exporting Countries plus Russia and other allies, agreed on Sunday to further raise oil production from October.
OPEC+ has been increasing production since April after years of cuts to support the oil market. The latest decision comes despite a likely looming oil glut in the northern hemisphere winter months.
Eight members of OPEC+ will lift production from October by 137,000 barrels per day. That, however, is much lower than increases of about 555,000 bpd for September and August and 411,000 bpd in July and June.
“The oil market was supported by relief over OPEC+’s modest output hike and a technical bounce following last week’s decline,” said Toshitaka Tazawa, an analyst at Fujitomi Securities, adding the OPEC+ output hike had been priced in since last week.
“Expectations of tighter supply from potential new U.S. sanctions on Russia are also lending support,” he said.
U.S. President Donald Trump said on Sunday he is ready to move to a second phase of sanctioning Russia, the closest he has come to suggesting he is on the verge of ramping up sanctions against Moscow or its oil buyers over the war in Ukraine.
New sanctions on buyers of Russian oil could disrupt crude flows, energy trader Gunvor’s global head of research and analysis, Frederic Lasserre, said on Monday.
Russia launched its largest air attack of the war on Ukraine, setting the main government building on fire in central Kyiv and killing at least four people, Ukrainian officials said on Sunday.
Trump said on Sunday that individual European leaders would visit the United States on Monday and Tuesday to discuss how to resolve the Russia-Ukraine war.
“Buying emerged as the OPEC+ output increase was smaller than anticipated, while fading prospects for peace in the Russia-Ukraine war and views that Russian oil won’t flood the market also supported prices,” said Satoru Yoshida, a commodity analyst with Rakuten Securities.
In a note over the weekend, Goldman Sachs said it expects a slightly larger oil surplus in 2026 as supply upgrades in the Americas outweigh a downgrade to Russia supply and stronger global demand. It left its Brent/WTI price forecast unchanged for 2025 and projected the 2026 average at $56/$52 a barrel.
(Reporting by Yuka Obayashi; Editing by Shri Navaratnam and Edwina Gibbs)