Oil steadied after hitting prices not seen in roughly a decade on Thursday, as sellers jumped in on hopes that the United States and Iran will agree soon to a nuclear deal that could add barrels to a badly undersupplied market.
Trade was volatile, however, as investors anticipate ongoing disruption to worldwide oil flows due to heavy sanctions on Russia after Moscow invaded Ukraine a week ago. Russia exports 4 to 5 million barrels of crude per day, second-most worldwide behind Saudi Arabia, and companies are now shunning Russian supply and scrambling for barrels elsewhere.
Brent futures rose 61 cents, or 0.5%, to $113.54 a barrel by 11:23 a.m. EST (1723 GMT), while US West Texas Intermediate (WTI) crude rose 15 cents, or 0.1%, to $110.75.
Both benchmarks rose to multi-year highs earlier in the session, with Brent soaring to $119.84, its highest since May 2012 and WTI hitting its highest since September 2008 at $116.57.
Washington and its Western allies have imposed sanctions on Russia over its invasion of Ukraine, but the measures have so far stopped short of targeting Russian oil and gas exports. A new round of sanctions announced by the White House on Wednesday ban the export of specific refining technologies, making it harder for Russia to modernize its oil refineries.
But international traders are still wary of becoming entangled in sanctions. At least 10 tankers failed to find buyers on Wednesday, market sources said.
Global benchmark Brent has jumped nearly 25% since the Russian invasion of Ukraine on Feb. 24. Brent's six-month spread hit a record high of over $21 a barrel, indicating very tight supplies.
Several media reports have suggested that a deal between the United States and Iran is nearly complete, which could bring more than a million bpd of oil, or about 1% of global supply, back to the market.
Negotiations to revive the pact have been going on for 10 months in Vienna, and diplomats are now believed to be in the final stage of talks.
