Oil prices climb 3% after Russia declared military mobilisation

Oil prices rose 3% in European trade on Wednesday on track for the first profit in three days amid mounting concerns about oil and gas supplies from Russia, after president Vladimir Putin announced a partial military mobilisation. 

Prices were also boosted after OPEC Plus pumped amounts less than agreed upon in August, while the Iranian nuclear deal is facing difficulties. 

Global Prices

US crude rose 2.9% to $86.66 a barrel, while Brent added 3.2% to $93.46 a barrel, with a session-low at $90.20. 

US crude lost 0.9% on Tuesday, while Brent lost 0.8% as investors shun high-risk assets. 

Russian Military Mobilisation

Russian President Vladimir Putin announced a partial military mobilisation in the country , putting the economy in a constant war state amid the ongoing Ukrainian campaign.

Putin accused the west of waging war on Russia and asserted Russia will use every available tool to protest itself and its people against external threats.

The mobilisation means gathering upwards of 300 thousand reserve troops to serve in the military campaign in Ukraine.

OPEC Plus

An internal document from OPEC Plus showed the group's oil production was less than specified targets during August, by nearly 3.583 million bpd, while July production was less by 2.892 million bpd from targets. 

Nuclear Deal

In others news about the Iranian nuclear dear, Russia said negotiations remain stuck, with France asserting the ball is in Iran's court to move forward now.

Difficulties achieving the deal means US and European sanctions on the Iranian oil sector are maintained, in turn preventing their return to markets. 

US Stocks

Initial US data showed commercial crude stocks rose by 1 million barrels in the week ending September 16, the fourth such increase in a row, below estimates of a 2 million barrels build. 

According to the tentative data, total US commercial crude stocks rose to 439 million barrels last week, the highest since August 2021, in a negative sign for demand in the US. 

Now investors await official government data on crude stocks, expected to show a buildup of 2 million barrels last week.