Oil climbed as investors weighed the fallout from a rebellion in Russia that turned into the greatest threat yet against Vladimir Putin’s almost quarter-century rule of the major OPEC+ producer.
West Texas Intermediate futures gained to trade near $70 a barrel in Asia after losing almost 4% last week. Brent crude also rose. An eerie calm fell on Russia after the dramatic end to an uprising by troops loyal to mercenary Yevgeny Prigozhin, though the instability could reverberate further.
“The internal military struggle in Russia adds limited oil price pressure amid heightened tensions in Moscow,” Rystad Energy Senior Vice President Jorge Leon wrote in a note. “The geopolitical risk amid internal instability in Russia has increased.”
Russia is a key leader of the OPEC+ coalition along with Saudi Arabia, and any prolonged turmoil in the nation could reverberate through global oil markets. The country’s war in Ukraine has already upended trade flows, with major consumers in Asia including China boosting imports of Russian energy.
Oil in New York is still around 13% lower this year, in part due to Russia’s resilient exports, along with aggressive monetary tightening from the US Federal Reserve and a lackluster economic recovery from China. Recession alarms are also ringing around Europe’s bond market.
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