Oil ticks higher as sanctions and Russian attacks take spotlight

Crude is headed for a third monthly gain as OPEC+ presses on with output curbs. While China’s shaky demand outlook has been a headwind, Premier Li Qiang said Beijing was stepping up policy support to spur growth, and that systemic risks were being addressed. Reflecting the bullish mood, money managers’ net-long positions on Brent have risen to the highest in more than a year.

Iranian-backed Houthis, meanwhile, fired a missile at Chinese-owned oil tanker Huang Pu on Saturday, US Central Command said, highlighting continued risks to shipping in the seas off Yemen. The assault came even after the militant group previously said they wouldn’t attack vessels from China.

“On one hand, demand and supply seems balanced, with the Saudis maintaining spare capacity, but on the other hand disruptions are around the corner” amid supply risks, said Stefano Grasso, senior portfolio manager at Singapore-based fund 8vantedge Pte. “Given the supportive macro picture and two wars near oil-producing countries, we remain surprised on how low oil prices have been.”