Oil prices climbed on Monday as fears of political instability in Russia following a revolt by Russian mercenaries over the weekend raised concerns about potential disruptions to oil supply from one of the world’s largest producers. Both Brent and US West Texas Intermediate (WTI) crude futures saw gains, although they later pared some of the initial increase.
Brent crude, the international benchmark, was trading 27 cents higher at $74.12 a barrel at 0234 GMT, while WTI crude was up 28 cents at $69.44 a barrel. Earlier in Asian trade, prices had surged as much as 1.3% before moderating to a 0.4% increase.
The escalation of the situation occurred when a clash between Moscow and the Russian mercenary group known as Wagner was narrowly avoided on Saturday. The heavily armed mercenaries subsequently withdrew from the southern Russian city of Rostov under an agreement that halted their advance towards the capital. Nevertheless, this incident has raised questions regarding President Vladimir Putin’s hold on power and has sparked concerns about potential disruptions to Russian oil supply.
Rystad Energy, a consultancy firm, commented in a note on Sunday that it did not anticipate a significant surge in oil prices due to the “short-lived event.” However, the firm acknowledged that the geopolitical risk stemming from internal instability in Russia has heightened. While it remains uncertain whether the recent incident will have a lasting impact on the global oil market, the concerns over political issues in Russia have underscored the vulnerabilities and potential
