Oil prices extend gains to two-week high as Kurdish supplies get disrupted

Oil prices rose in European trade for the second straight session, hitting two-week highs as Kurdish supplies from Kurdistan get disrupted following a court order in Turkey. 

Prices are boosted as well by signs of improving demand in China after reopening the economy, and following remarks by the Russian government on output. 

Global Prices

US crude rose 0.9% to $73.47 a barrel, the highest since March 14, while Brent climbed 0.7% to $78.27 a barrel, the highest since March 15. 

US crude rose 5.3% on Monday, while Brent added 4.4%, the first profit in three days, and the largest since March 2022. 

Such large profits came amid concerns about Iraqi supplies, while concerns about the banking sector subsided. 

Kurdish Supplies

Turkey stopped the Kurdistan Region from pumping crude through its oil pipeline after a court  order than required the approval of the Iraqi government to ship the oil.

Such legal conflicts in Iraq between the federal government and Kurdistan led to a cut of 450 thousand bpd in crude exports. 

Chinese Demand

Recent estimates from the government point to an increase of 6.2% in China's crude imports this year to 540 million tones. 

Russian Output

Russian energy minister Alexander Novak said Moscow is approaching its target of cutting output by 500 thousand bpd to 9.5 million bpd.

Even as production slows down, it's expected that crude exports will remain flat as Russian refinery output slows down in April.

Russian refined products will be hit more by the recent ban by the EU, rather than crude exports, with tones of Russian diesel awaiting on ships for buyers.