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Oil jumps as EU weighs Russian ban, Saudi refinery output hit

A view of the Phillips 66 Firm’s Los Angeles Refinery (foreground), which processes home & imported crude oil into gasoline, aviation and diesel fuels, and storage tanks for refined petroleum merchandise on the Kinder Morgan Carson Terminal (background), at sundown in Carson, California, U.S., March 11, 2022. Image taken March 11, 2022. Image taken with a drone. REUTERS/Bing Guan

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  • EU to weigh Russian oil embargo, with Biden set to hitch talks
  • Saudi refinery output hit by Yemen Houthi assault
  • OPEC+ provide hole widens additional as February compliance jumps
  • U.S. oil rigs down regardless of $100/bbl crude costs -Baker Hughes

SINGAPORE, March 21 (Reuters) – Oil costs jumped greater than $3 on Monday, with Brent above $111 a barrel, as European Union nations take into account becoming a member of america in a Russian oil embargo, whereas a weekend assault on Saudi oil services prompted jitters.

Brent crude futures climbed $3.74, or 3.5%, to $111.67 a barrel by 0739 GMT, including to a 1.2% rise final Friday.

U.S. West Texas Intermediate (WTI) crude futures rose $3.98, or 3.8%, to $108.68, extending a 1.7% leap final Friday.

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Costs moved increased forward of talks this week between European Union governments and U.S. President Joe Biden for a collection of summits that intention to harden the West’s response to Moscow over its invasion of Ukraine.

EU governments will take into account whether or not to impose an oil embargo on Russia. learn extra

Early on Monday, Ukraine’s deputy prime minister, Iryna Vershchuk, stated there was no probability the nation’s forces would give up within the besieged jap port metropolis of Mariupol. learn extra

With little signal of the battle easing, the main target returned as to whether the market would be capable to exchange Russian barrels hit by sanctions.

“A Houthi assault on a Saudi vitality terminal, warnings of a structural shortfall in manufacturing from OPEC, and a possible European Union oil embargo on Russia have seen oil costs leap in Asia,” OANDA’s senior analyst Jeffrey Halley stated in a be aware.

“Even when the Ukraine warfare ends tomorrow, the world will face a structural vitality deficit, because of Russian sanctions.”

Over the weekend, assaults by Yemen’s Iran-aligned Houthi group prompted a brief drop in output at a Saudi Aramco refinery three way partnership in Yanbu, feeding concern in a jittery oil merchandise market, the place Russia is a key provider and international inventories are at multi-year lows. learn extra

The most recent report from the Group of the Petroleum Exporting Nations and allies together with Russia, collectively referred to as OPEC+, confirmed some producers are nonetheless falling wanting their agreed provide quotas.

OPEC+ missed its manufacturing goal by greater than 1 million barrels per day (bpd) in February, three sources instructed Reuters, underneath their pact to spice up output by 400,000 bpd every month as they wind again sharp cuts made in 2020. learn extra

The 2 OPEC international locations with the capability to immediately elevate output, Saudi Arabia and the United Arab Emirates, have up to now resisted calls from main consuming nations to step up manufacturing sooner to assist drive down oil costs.

U.S. vitality corporations are additionally struggling to maintain the variety of lively oil rigs up, regardless of robust costs. learn extra

The poor provide outlook and excessive costs prompted the Worldwide Vitality Company to stipulate methods on Friday to chop oil use by 2.7 million bpd inside 4 months, from car-pooling to decrease pace limits and cheaper public transport. learn extra

That might assist offset the three million bpd of Russian crude and merchandise that the IEA estimated could be off the market by April. learn extra

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Reporting by Sonali Paul in Melbourne and Florence Tan in Singapore; Modifying by Shri Navaratnam and Clarence Fernandez

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