Oil dips as IEA prepares for release from reserves

Oil futures fell sharply on Wednesday as news that members of the International Energy Agency (IEA) would release oil from reserves in conjunction with the United States to counter tightening supply.

Brent crude futures reached to $103.86 per barrel. Meanwhile, US West Texas Intermediate (WTI) futures also fell to $99.04 per barre.

On Wednesday members of the IEA told news agencies that they will release 120 million barrels from strategic reserves, including 60 million from the United States.

The news came as Western leaders are set to announce a new set of sanctions against Russia later on Wednesday. White House Press Secretary Jen Psaki said the measures will target Russian financial and state-owned bodies, as well as some officials and oligarchs.

The proposed sanctions by EU would ban buying Russian coal and prevent Russian ships from entering EU ports. Britain also urged G7 and NATO nations to agree a timetable to phase out oil and gas imports from Russia.

Supply concerns in the oil market have risen dramatically after Russia’s invasion of Ukraine. The sentiment on Wednesday wiped off earlier price falls due to a stronger dollar, which makes oil more expensive for holders of other currencies, and a better-than-expected build in US crude stockpiles.