Oil mixed as new sanctions cause fears

Brent crude futures (BRN1!) were higher 11 cents, or 0.1%, at $106.75 a barrel as of 0339 GMT, having dropped to $105.06 earlier.

U.S. West Texas Intermediate futures (CL1!) lost 11 cents, or 0.1%, to $101.85 a barrel, after falling to as low as $100.37 in early trade.

On Wednesday, the United States and its partners prepared new sanctions on Moscow over civilian killings in northern Ukraine, which President Volodymyr Zelensky defined as “war crimes,” demanding commensurate punishment. Russia banned targeting civilians.

Preventing Russian shipments and buying their coal

Proposed EU sanctions, which the bloc’s 27 member states must consent to, would ban buying Russian coal and contain Russian ships from entering EU ports. Britain also encouraged G7 and NATO nations to agree on a timetable to phase out oil and gas imports from Russia.

The growing supply worries erased earlier price falls due to a stronger dollar, making oil more costly for holders of other currencies and a surprise build in U.S. crude stockpiles.

The dollar framed up to its highest level in almost two years on Wednesday after bouncing overnight on more hawkish comments from a Federal Reserve official.

As stated by market sources citing American Petroleum Institute figures on Tuesday, U.S. crude and distillate stocks increased last week while gasoline inventories dipped.

Crude stocks grew by 1.1 million barrels for the week finished April 1, against analysts’ forecast of a drop of 2.1 million barrels.

Demand concerns also mounted after top oil importer China authorities extended a lockdown in Shanghai to shield all of the financial center’s 26 million people.

Meanwhile, the International Energy Agency (IEA) member states discussed how much oil they would release from storage to cool markets. Three sources informed Reuters, adding that an announcement was expected in the coming days.