Oil prices edged higher on Friday (July 18th), heading for a slight weekly loss, as investors weighed new EU sanctions against Russia.

Brent crude futures rose 50 cents, or 0.72%, to $70.02 a barrel at 09:12 GMT, while U.S. West Texas Intermediate crude futures rose 61 cents, or 0.9%, to $68.15 a barrel. At those levels, the contracts were headed for marginal weekly losses of 0.5% and 0.4%, respectively.

Investors were weighing the potential impact on global oil balances of the European Union's agreement on an 18th package of sanctions against Russia over its war in Ukraine, which includes measures aimed at further damaging Russia's oil and energy industries.

The latest sanctions package would lower the G7's price ceiling for buying Russian crude to $47.60 a barrel, diplomats told Reuters. "Neither the Russian oil price cap nor the addition of a shadow tanker to the sanctions list has succeeded in disrupting Russian oil exports so far, so the market remains skeptical about the impact of the latest sanctions," said UBS analyst Giovanni Staunovo.

Investors are awaiting news from the US regarding the possibility of further sanctions, after President Donald Trump earlier this week threatened to sanction buyers of Russian exports unless Moscow agrees to a peace deal within 50 days.

"Ultimately, it now remains to be seen whether a major change in US sanctions and tariff policy is possible," Commerzbank analysts said in a note. Four days of drone attacks on oil fields in Iraqi Kurdistan that halted half of the region's production have supported prices, pushing both contracts up by $1 on Thursday.

The attacks "will certainly have a negative impact as the region's production has already been cut from 280,000 barrels per day to around 130,000 barrels per day," said PVM analyst Tamas Varga. Officials have pointed to Iran-backed militias as the likely source of this week's attacks on oil fields in the region, although no group has claimed responsibility. (alg)

Source: Reuters