Oil prices climbed on Tuesday amid growing concerns over supply disruptions as the conflict between Russia and Ukraine intensifies, while investors also weigh upcoming U.S. jobs data that could influence interest rate decisions.
Brent crude rose 37 cents, or 0.54%, to $68.52 per barrel by 7:17 AM WAT. U.S. West Texas Intermediate (WTI) crude gained $1.01, or 1.58%, to $65.02 per barrel. WTI futures did not settle on Monday due to the Labor Day holiday in the United States.
The market is closely watching U.S. labor data, set to be released this week ahead of the Federal Reserve’s September meeting. Weak payrolls data in July have raised expectations that the Fed may cut interest rates, which could support energy prices by easing the cost of holding commodities.
On the supply side, Ukrainian drone strikes have temporarily shut down facilities accounting for roughly 17% of Russia’s oil-processing capacity—about 1.1 million barrels per day, according to Reuters. Ukrainian President Volodymyr Zelenskiy warned that Ukraine plans further strikes deep into Russian territory, following weeks of intensified attacks on Russian energy infrastructure.
Three-and-a-half years into the war, both sides have escalated airstrikes: Russia targeting Ukraine’s energy and transport networks, and Ukraine focusing on Russian oil refineries and pipelines.
Read Also: Gold Hits Record $3,508 Amid Global Economic Uncertainty
Geopolitical tensions are further heightened by China’s push for a “new global order.” Chinese President Xi Jinping promoted his vision for global security and economic reforms prioritizing the “Global South,” in a summit attended by Russia and India. China and India are the largest buyers of Russian crude, even as the U.S. has imposed additional tariffs on India over these purchases.
Investors are also awaiting the OPEC+ meeting on September 7 for potential guidance on production plans. Analysts expect the alliance to maintain current output levels after unwinding previous supply cuts.
Meanwhile, the International Energy Agency notes that oil supply has been growing faster than demand, partly due to tariff pressures and shifting trade dynamics, adding to the volatility in global markets.
