(Bloomberg) — Oil erased an earlier gain as broader financial markets held steady after the dramatic but short-lived rebellion in Russia over the weekend.
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West Texas Intermediate traded near $69 a barrel, while Brent futures were also little changed. An eerie calm fell on Moscow after the end of the uprising led by Yevgeny Prigozhin, head of the Wagner mercenary group. Yet investors are weighing the potential for more turbulence in Russia, a major OPEC+ producer.
“This weekend’s developments will not be an immediate game changer,” said Keshav Lohiya, founder of consultant Oilytics. “Russia’s resilient oil production has been a big surprise and one of the significant bearish overhangs in the market.”
The country’s war in Ukraine has already upended trade flows, with major consumers in Asia boosting imports of Russian energy, and any prolonged turmoil in the nation could reverberate through global oil markets.
Goldman Sachs Group Inc. said the impact on oil prices following the armed uprising may be limited because markets are often focused on spot fundamentals, which haven’t changed. Yet RBC Capital Markets LLC said the risk of further civil unrest “must be factored into our oil analysis.”
Oil in New York is around 13% lower this year, in part due to Russia’s robust exports but also reflecting monetary tightening from the US Federal Reserve and a lackluster economic recovery in China. Recession alarms are also ringing around Europe’s bond market.
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