Oil extends advance above $100 as Ukraine crisis continues

Oil pushed higher after rallying back above $100 a barrel as Russian President Vladimir Putin vowed to continue the crisis in Ukraine, which has rattled markets and tightened global crude supply.

West Texas Intermediate futures rose 0.8 per cent in Asia after surging almost 7 per cent on Tuesday. Putin said peace talks with Ukraine are “at a dead end” as the crisis continues into its second month.

US crude output will grow at a slower pace than previously expected, the Energy Information Administration (EIA) forecast.

The crisis in Europe has rippled through global markets and fanned inflation just as governments were trying to spur economic growth as the pandemic faded. A massive planned release of strategic crude reserves by the US and its allies along with China’s demand worries due to a virus resurgence there have weighed on prices in the last few weeks.

US crude output is expected to average 12.01 million barrels a day this year, compared with the previous forecast of 12.03 million barrels a day, according to the EIA. Shale producers are grappling with higher production and labour costs amid rampant inflation. The International Energy Agency will provide its snapshot of the overall market later Wednesday.

The American Petroleum Institute reported US crude stockpiles rose by 7.76 million barrels last week, according to people familiar with the data.

Gasoline inventories shrunk by 5.05 million barrels, the API said.