Brent crude futures were up $2.53, or 2.28%, at $113.67 a barrel this morning after trading in about a $5 range.
"So to suggest the oil market is confused would be an understatement as we are in an unprecedented situation," said Stephen Innes, managing partner at SPI Asset Management. Just hours before, prices slumped on comments from UAE's ambassador to Washington saying his country will be encouraging OPEC to consider higher output to fill the supply gap due to sanctions on Russia after it invaded Ukraine.The comments from UAE officials came as the market also took into account moves by the US to ease sanctions on Venezuelan oil and efforts to seal a nuclear deal with Tehran, which could lead to more oil supply coming from Iran later this year.
"We think it will be challenging for OPEC+ to boost production in this environment," Commonwealth Bank commodities analyst Vivek Dhar said.