Petrol Prices are Rising: Reasons Behind the Weekly Gains

Expectations in the Oil Market

Oil prices are preparing to achieve their biggest weekly gain since June, with expectations of supply cuts and increased demand for alternative types of oil following the U.S. sanctions on major oil producers targeting Russia.

Current Situation in Prices

On Friday, Brent crude fell to $65 per barrel, yet showed an increase of approximately <%7 on a weekly basis. Meanwhile, U.S. Crude Oil (WTI) prices dropped below $62.

Russia's Oil Shipments May Decrease

As a result of the imposed sanctions, purchases from major Russian oil companies such as Rosneft PJSC and Lukoil PJSC are expected to be affected. In particular, there are discussions about Russia's oil shipments to India being cut off and some Chinese state refineries suspending their purchases of Russian oil.

OPEC and Expectations of Price Increase

With a warning of potential further increases in oil prices following the statement from the Kuwait Oil Minister that OPEC is ready to increase production if demand rises, Russia, which has experience in circumventing sanctions, is preparing for a response.

How Have U.S. and EU Sanctions Affected the Market?

After the announcement of sanctions by the U.S. and European Union, oil prices rose rapidly. This situation can lead to fluctuations in global markets.

China's Oil Trade Is on the Agenda

According to sources close to the issue, major Chinese oil companies have begun evaluating the effects of the U.S. sanctions and have preferred to suspend spot purchases, particularly for ESPO type Russian crude oil.

U.S. President Donald Trump announced that he would discuss China-Russia oil trade with Chinese President Xi Jinping at a meeting to be held in South Korea next week.