Prices on oil increased Friday morning due to expectations of a decline in Russian oil supplies. At the same time, increases are limited by concern over reduced US demand following a domestic blizzard.

A barrel of European reference oil Brent traded at USD 81.68 on Friday morning against USD 81.47 Thursday afternoon, with US counterpart WTI trading at USD 78.32 compared to USD 77.66 on Thursday afternoon.

Russia’s oil exports to Europe are expected to drop by 20% in December compared to the previous month because of the price cap and sanctions imposed by the European Union and G7 nations earlier in the month, according to Reuters’ calculations.

Russia plans to cut oil production by 5-7% in early 2023 as a response to sanctions, says Russian Deputy Prime Minister Alexander Novak, according to RIA News.

”Crude prices are higher as energy traders focus on Moscow’s response to the price cap put on Russian oil and not so much the thousands of flight cancellations that will disrupt holiday travel,” states Edward Moya, Oanda analyst, to Reuters.

More than 4,400 planes have been called off in the US for the last two days due to the blizzard, prompting oil prices to decline on Thursday.

Conversely, cold winter weather has made demand for heating oil go up due to anticipated power cuts.

US oil inventories fell more than predicted last week because of a slowdown in imports, states the Energy Information Administration (EIA).

In other commodities, one troy ounce of gold costs USD 1,795.49 Friday morning against USD 1,795.69 on Thursday afternoon.

Oil pushes higher after drop in US inventories