Still Underpinned

WTI is ~+$1.50, while Brent is ~+$1.40 at typing, with geopolitical unrest surrounding the Russia-Ukraine situation underpinning crude early this week. Both benchmarks hit fresh cycle highs in early Asia-Pac dealing ($94.94 for WTI & $96.16 for Brent), before backing off from best levels.

• Russia-Ukraine tensions remain elevated following Friday’s U.S. warning re: the potential for a Russian invasion “at any time.” Weekend calls between U.S. President Biden, Blinken (U.S. Secretary of State), Austin (U.S. Secretary of Defense), and their respective Russian counterparts produced no breakthroughs, but the continued push to find a diplomatic solution seems to have been welcomed by broader markets (and probably allowed crude to ease back after the early Asia bid).
• Elsewhere in the geopolitical sphere, an Iranian official noted that progress in the well-documented talks surrounding the discontinued nuclear accord was becoming “more difficult,” which may have provided another tailwind for oil early on.
• Crude specific news continues to be supportive. The IEA on Friday warned of “upward pressure” on oil prices due to OPEC+’s “chronic” issues with restoring production, highlighting increased strain on OECD oil inventories, which have declined to 7-year lows.