Oil rises amid expected new sanctions against Russia

Oil futures rose on Wednesday to recoup losses early in the session as supply concerns increased after new sanctions against Russia were threatened, outweighing concerns of weak demand after an increase in US crude stocks and the extension of the general closure in China’s Shanghai.

Brent crude futures rose 49 cents, or 0.5 percent, to $107.13 a barrel, after falling to $105.06 earlier in the session.

West Texas Intermediate crude futures rose 21 cents, or 0.2 percent, to $102.17 a barrel, after falling to $100.37 a barrel in early trade.

On Wednesday, the United States and its allies prepared new sanctions against Moscow over the killing of civilians in northern Ukraine, which Ukrainian President Volodymyr Zelensky called “war crimes” and demanded appropriate punishment. Russia denies targeting civilians.

Sanctions proposed by the European Union, which must be approved by member states, would ban the purchase of Russian coal and prevent Russian ships from entering EU ports. Britain also urged the Group of Seven of the world’s largest economies and NATO member states to set a time frame for a gradual halt to Russian oil and gas imports.

Fears of growing supplies offset the decline in prices earlier due to the increase in the dollar, which makes oil more expensive for holders of other currencies, and an unexpected increase in US crude inventories.

Demand concerns increased after China, a major oil importer, extended a general lockdown in the country’s financial hub, Shanghai, with a population of 26 million.