(New York) Oil prices started the week modestly higher on Monday, as gains sparked by the mutiny of the paramilitary group Wagner in Russia remained tempered by a lackluster economic backdrop, unfavorable to global demand.
A barrel of Brent North Sea oil, for August delivery, gained 0.44% to $74.18.
Its American equivalent, a barrel of West Texas Intermediate (WTI), for delivery the same month, took 0.30% to 69.37 dollars.
Prices hesitated in early trading, “markets considering the potential impact of the weekend putsch in Russia,” said Ricardo Evangelista, analyst at ActivTrades.
Russia on Monday tried to show a return to normalcy with the lifting of security measures introduced during the uprising of the Wagner Group.
Wagner’s leader, Yevgeny Prigojine, author of an abortive mutiny which lasted 24 hours from Friday evening, had promised to “liberate the Russian people” by targeting in particular the Russian Minister of Defense Sergei Shoigu and the head of staff Valéri Guérassimov, whom he accuses of having sacrificed thousands of men in Ukraine.
Mr. Prigojine ended his rebellion on Saturday evening, in exchange for immunity for himself and his men.
“Despite the apparent resolution of the short-lived insurgency, many question marks remain, with the possibility of further unrest that could disrupt Russia’s oil supply,” Evangelista noted.
Daniel Ghali, energy markets specialist for TD Securities, said “limited disruptions in Russia’s energy industry over the weekend kept energy supply risk premia stable, although geopolitical risks to Russian oil supply have likely increased.”
These risks, which could boost prices, were offset by global economic prospects “which are deteriorating faster than we thought”, and which could therefore weigh on energy demand, underlined for his part Tamas Varga, analyst of PVM Energy. He cited stubborn inflation and high interest rates that can lead to an economic slowdown.
