Crude Little Changed, Talk Of Further Sanctions On Russia

Oil prices are currently little changed during today’s APAC session but are off their intraday lows. Weak supply-demand fundamentals continue to be offset by geopolitical tensions and threats to Red Sea shipping. Brent is down 0.1% to $83.46/bbl after falling to $83.23 early in trading and WTI is also 0.1% lower at $78.36 rising from $78.02. The USD index is 0.1% higher.

• OPEC quota compliance has been lax and Iraq has said that it will try and improve after it has done a review of its estimated output. OPEC+ meets in early March to decide if it will extend production cuts into Q2.
• Sanctions on Russia are in focus again and stricter measures are expected from the EU on its oil and gas, including against Indian and Chinese firms that have contributed to Russia’s defence industry. The US is also looking at improving enforcement. The death on the weekend of opposition leader Navalny and Ukraine’s loss of Avdiivka have put pressure on NATO countries to increase sanctions.
• G7 transport ministers are going to hold an online meeting to discuss the situation in the Red Sea.
• US inventory data has been volatile since a cold snap disrupted oil output and refining. Data for the latest week is released by API later today.
• Later the BoE’s Bailey appears. There are also January Canadian CPI data and US Philly Fed non-manufacturing and leading indices.