Oil prices edged higher as investors weighed the impact of U.S. sanctions on Russia's Rosneft PJSC and Lukoil PJSC, which will take effect on Friday, while the European Union explored further measures to pressure Moscow.

Brent traded near $64 a barrel after falling more than 2% on Wednesday, its biggest drop in a week, and West Texas Intermediate neared $60. U.S. sanctions on the Russian oil giant have disrupted crude flows, particularly to India, and forced Lukoil to seek buyers for its international assets.

Oil prices remained near annual losses on expectations of a surplus as OPEC+ and other producers increase production, although recent geopolitical tensions have added a risk premium to prices. Russian fuel exports in the first half of November fell to their lowest level since the invasion of Ukraine due to attacks on the country's oil refining infrastructure and U.S. sanctions. Suitors lined up to acquire various parts of Lukoil's international business after the penalties.

Exxon Mobil Corp. officials met with Iraqi Oil Minister Hayyan Abdul Ghani on Wednesday to discuss a Russian company's stake in the West Qurna 2 field, which accounts for 10% of Iraq's production.

Meanwhile, the EU is exploring more restrictions on entities that enable Russia's shadow tanker fleet to transport oil in a further effort to disrupt Moscow's ability to fund its war against Ukraine. US sanctions on Rosneft and Lukoil are also part of renewed efforts to end the conflict.

Brent for January settlement rose 0.7% to $63.98 a barrel at 10 a.m. in London. WTI for December delivery, which expires on Thursday, rose to $59.92 a barrel. The more active January contract rose to $59.76 a barrel. (alg)

Source: Bloomberg