Oil prices rose today, Tuesday, for the second day in a row, in light of fears of a lack of European supplies after Russia cut gas supplies through a major pipeline, which is a major supplier of oil and natural gas in the region.
According to Arab Net, Brent crude futures for September rose $1.51, or 1.4 percent, to $106.66 a barrel, after they jumped 1.9 percent the previous day.
US West Texas Intermediate crude contracts for September also increased $1.36, or 1.4%, to $98.04 a barrel, after rising 2.1%, on Monday.
Russia reduced gas supplies to Europe yesterday, after Gazprom said that supplies through the Nord Stream 1 pipeline to Germany would be reduced to only 20% of its capacity.
Russia's supply cuts will make countries unable to achieve their goals of refilling natural gas reserves before the winter demand period.
Germany, Europe's largest economy, faces the prospect of gas rationing for industry to keep its citizens warm during the winter months.
This may prompt end users to exchange gas for petroleum products, especially diesel. But this also carries risks, because Russia supplies the region with most of the diesel.
Prices are expected to rise for drivers who rely on fuel.
The general manager of research at Nissan Securities, Hiroyuki Kikukawa, said that higher gas prices, caused by the reduction of Russian supplies, may increase the shift from gas to oil and support crude prices.
Supplies of crude oil, oil products and gas to Europe have been disrupted by Western sanctions and disputes with Russia over payment since its February 24 invasion of Ukraine, which Moscow describes as a special military operation.
However, lower demand due to the recent rise in crude oil and fuel prices and the expectation of an increase in interest rates in the United States has put pressure on prices.
