Oil prices are on track to end their wildest week ever seen, with a massive $20 a barrel trading range in the past five days, as the Russian invasion of Ukraine sparked concerns about supply amid an exodus of buyers of Russian commodities.
As of 9:56 a.m. ET on Friday, WTI Crude was up 5.25% at $113.45 and Brent Crude was trading up 4.48% at $115.54.
Oil prices started this week in the low $100s for Brent and mid-$90s for WTI. The U.S. benchmark broke above $100 a barrel early this week and continued rallying. Early on Thursday, WTI Crude had jumped by 5.16% to $116.44, the highest level since 2011, while Brent Crude had rallied by 5.89% at $119.77, the highest since 2013. Later on Thursday, prices pared gains after rumors emerged that deal on Iran's nuclear activities could be signed within a few days.
The announcement of a decision for the release of 60 million barrels of crude oil from various countries' strategic petroleum reserves failed to stop the oil price rally on Tuesday.
Further supporting prices this week was the OPEC+ group's decision from Wednesday to rubberstamp another 400,000 barrels per day (bpd) increase in its collective oil production in April, despite soaring oil prices after its key member Russia invaded Ukraine.
The high volatility this week means that oil prices traded in a range of $20 per barrel. That's the highest ever trading range for a week since the Brent benchmark was launched in 1988, Bloomberg notes. The wild volatility this week even surpassed the swings in oil prices during the financial crisis of 2008 and the start of the COVID pandemic in early 2020.
"With supply risks having become real we have entered a very volatile stage with no solution potentially forcing prices to levels that kills demand," Saxo Bank's strategy team wrote in a note early on Friday.
Supply from Russia is already constrained despite the fact that there are no sanctions on Russian oil.
After the Western allies kicked several Russian banks out of the international SWIFT system, trading in Russian commodities has become toxic for many global players.
By Tsvetana Paraskova for Oilprice.com
More Top Reads From Oilprice.com:
Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More