Brent crude oil rallies towards $89 a barrel with focus on Ukraine

Brent crude oil climbed toward $89 a barrel after industry estimates showed a draw in US stockpiles and investors tracked tensions over Ukraine.

The global crude benchmark rose 0.9 per cent in London. The American Petroleum Institute reported an 875,000-barrel weekly drop in US crude stockpiles, according to people familiar with the data. If confirmed by government figures later on Wednesday, it would be the eighth decline in nine weeks. The oil market’s structure has also surged in recent days, signalling tight supply.

Wider markets also rallied on Wednesday, as this week’s sell-off started to ease.

Crude is having a volatile week, retreating Monday then rebounding Tuesday. Prices remain close to a seven-year high, with demand continuing to recover from the pandemic as mobility picks up. A string of Wall Street banks, including Goldman Sachs, have forecast oil will hit $100 a barrel this year as the global market tightens.