Supply concerns boost Brent oil prices last week, Deutsche Bank sees prices rising to $90.

Due to concerns about the latest US sanctions on Russia leading to supply disruptions, as well as strong demand for heating fuels in the winter, crude oil futures posted cumulative gains last week. However, crude oil futures fell on last Friday ahead of the Martin Luther King Jr. holiday and Trump's inauguration on Monday. Additionally, the approval of a ceasefire agreement between Israel and Hamas by the Israeli security cabinet eliminated some of the risk premium for crude oil. Data shows that Brent crude oil futures fell 0.6% on last Friday to $80.79 per barrel, with a cumulative increase of 1.3% for the week. Deutsche Bank stated that if Russian oil production were to be disrupted by 1 million barrels per day from the second quarter to the fourth quarter, Brent crude prices could rise to $90 per barrel. However, the bank also pointed out that this scenario might prompt OPEC+ member countries to accelerate planned production increases, which would require concessions from Russian officials and limit the rise in oil prices. Kieran Tompkins, a senior commodity economist at Capital Economics, stated that while the oil market has been digesting the impact of new sanctions on Russia, attention is now shifting to how the incoming Trump administration will handle it. Kieran Tompkins said, "The clear message from Steven Mnuchin, Trump's nominee for Treasury Secretary, indicates that he is prepared to actively use sanctions on Russia's oil sector to bring Russia to the negotiating table, suggesting that US policy is unlikely to reverse course quickly." He added, "From a technical standpoint, the market is in overbought territory, so a correction is due. However, the continued increase in supply risks continues to provide broad support for oil prices."