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Oil Prices Rise on Global Economy Optimism

Oil prices increased on Wednesday due to optimism over the global economy and concerns over the effects of sanctions on Russian crude output.

Oil facilities
Oil facilities

The higher-than-expected build of U.S crude and fuel stocks didn't weigh the markets down.

Brent crude futures saw a rise of $1.48, or 1.9%, to $81.58 a barrel. U.S. West Texas Intermediate (WTI) crude futures saw a rise of $1.35, or 1.8%, to $76.47.

Impact of Sanctions on Russian Output

Russian output could be affected as sanctions take their toll. An international price cap on sales of Russian crude took effect on December 5th, and more restrictions on product sales are set to come into force next month.

China Reopens its Economy

Some of the market's optimism is pinned on top oil importer China's reopening of its economy after the end of strict COVID-19 curbs. If inflation falls below expectations, that will lower the dollar, which could boost oil demand because it makes the commodity cheaper for buyers holding other currencies.