Oil rises amid supply concerns

oil rig

Oil prices rose today, Sept. 22, after dropping nearly 1% in the previous session, as supply concerns overshadowed fears of a global economic recession.

International benchmark Brent crude rose 0.65%, or 58 cents, to $90.41 a barrel, at 9:15 am Makkah time, after falling below $90 yesterday.

West Texas Intermediate (WTI) crude was up 0.59%, or 49 cents, to $83.44 a barrel, recovering from a decline of 1.2% in the last session.

Both benchmark grades declined to their lowest level in nearly two weeks on Sept. 21 after the US Federal Reserve raised interest rates by 75 basis points for a third time to tame inflation, while indicating that borrowing costs will continue to rise this year.

Meanwhile, the US Energy Information Administration data revealed that the average production of crude oil settled at 12.1 million barrels per day (bpd) in the week ended Sept. 16. Exports rose slightly to reach 3.54 million bpd, and imports rose to reach 6.947 million bpd.

Separately, Russian President Vladimir Putin called up 300,000 reservists to fight in Ukraine and endorsed a plan to annex parts of the country, which has escalated the conflict and increased the risk of geopolitical unrest and thus a shortage of Russian energy supplies.

Meanwhile, some Chinese refineries are considering increasing operations in October, which could boost demand for crude oil.

But oil prices remain under selling pressure due to inventory stock builds and a worsening economic outlook, Reuters reported, citing a note from Citi analysts.