Oil prices recouped losses on Wednesday as investors weighed conflicting statements on the possible withdrawal of some Russian troops from around Ukraine amid tight global supplies and recovering fuel demand.
Brent crude was up $1.53, or 1.6%, at $94.81 a barrel around 1320 GMT, having slid 3.3% overnight after Russia announced a partial pullback of its troops near Ukraine.
U.S. West Texas Intermediate (WTI) crude was up $1.31, or 1.4%, at $93.38 after the contract ended Tuesday’s session with a 3.6% decline.
Both benchmarks hit their highest since September 2014 on Monday, with Brent touching $96.78 and WTI reaching $95.82.
The price of Brent jumped 50% in 2021 while WTI soared by about 60% as a global recovery in demand from the COVID-19 pandemic strained supplies.
Moscow announced a partial pullback of troops from Ukraine’s borders but NATO Secretary-General Jens Stoltenberg said on Wednesday the alliance had seen no de-escalation and that Russia was continuing its military build-up.
“The risk of a full scale invasion has receded a bit. But we are unlikely to move out of the current status quo,” said Bjarne Schieldrop, chief commodities analyst at SEB in Oslo.
Beyond Ukraine tensions, the oil market remains tight and prices could still be on course for a move toward $100 a barrel.
“The market remains extremely tight and prices had been on an upward trajectory prior to the escalation. The softening of tensions may have only delayed the march to $100,” said Craig Erlam, senior market analyst at OANDA.
Investors were awaiting weekly U.S. oil inventory data from the Energy Information Administration at 10:30 a.m. (1530 GMT).
U.S. crude and distillates inventories could have fallen by 1.5 million to 1.6 million barrels last week, a Reuters poll showed.
Data from the American Petroleum Institute showed a drop in crude, gasoline and distillate stocks last week, according to market sources on Tuesday. Reuters