North Sea oil, a benchmark in Europe, closed the session on the Intercontinental Exchange 65 cents above the $62.48 mark it ended at on Tuesday.
The European crude regained ground today as investors assess the possibility of an oversupply and a potential agreement between Ukraine and the Russian Federation, which could reduce sanctions on the Russian energy sector and increase global oil production, despite a cooling demand scenario.
During the previous session, following reports that Ukraine had approved most of the US proposal to end the war, Brent dropped by 2.33%, but recovered after doubts about its authenticity arose.
Despite today’s recovery, analyst Fawad Razaqzada stated that “any sign of real progress could soften energy prices, but even without an agreement, the bullish potential for oil prices remains limited due to underlying issues: oversupply and weak demand growth.”
He warned that Brent continues a downward trend, pressured by improved geopolitical conditions, increased supply, and weakened demand, and may soon drop below the $60 threshold.
