Muscat: Global crude oil prices rose by more than two per cent on Wednesday after Russian President Vladimir Putin announced a partial military mobilisation, raising fears of a shortage in oil and gas supplies.

Brent crude futures rose $2.28, or 2.5 per cent, to $92.90 a barrel, after falling $1.38 in the previous session, while US West Texas Intermediate (WTI) crude futures rose by $2.22, or 2.6 per cent, to $86.16 a barrel.

Oman oil price
Oman oil price (November Delivery 2022) on Tuesday reached $92.84, comprising a rise by 24 cents from the price of Tuesday which stood at $92.60, on the Dubai Mercantile Exchange (DME).

The average price of Oman oil (September Delivery 2022) has stabilised at $103.21 per barrel, thus $9.72 per barrel lower than August Delivery 2022.

“Oil markets strongly rebounded in response to the Russian president’s announcement regarding the conflict in Ukraine. The planned mobilisation of Russian troops could result in increasing tensions, disruptions in oil deliveries as well as new sanctions from Europe,” Wael Makarem, Senior Market Strategist – MENA at Exness, said to Times of Oman.

“This could add to the concerns around supply levels, possibly shifting attention away from the decreasing demand for a moment. Geopolitical tensions could also affect current price trends if the confrontation flares up,” he further added.

At the same time, traders remained concerned about the slowing demand as global economic output continues to cool down. This could continue to affect oil prices over the longer term as geopolitical tensions abate, Makarem said.

The US Federal Reserve is widely expected to hike rates by 75 basis points for the third time in a row later on Wednesday in its drive to rein in inflation. This could also impact expectations regarding the global economy and demand for energy. A stronger-than-expected interest rate hike could put downward pressure on oil prices, he said.

“As a result, energy markets could see strong volatility in the coming days as traders react to the central bank’s decision on one side as well as to the increasing tensions in Europe on the other,” he added.