Tight supply has led to higher oil prices

Oil prices rose 1% on Tuesday (June 21), erasing more of last week's losses as investors focused only on tight supplies of crude oil and fuel products rather than fearing that a recession would dampen future demand
.

At 0400 GMT, Brent crude futures rose $1.
08, or about 1 percent, to $115.
21 a barrel, up 0.
9 percent
on Monday.
The benchmark contract fell 7.
3% last week, its first weekly decline
in five weeks.

July U.
S.
West Texas Intermediate crude (WTI) crude futures, which expire late on Tuesday, rose to $112.
01 a barrel, up $2.
45 or 2.
2% from Friday's close, with WTI down 9.
2%
last week.

The more active August WTI contract rose $2.
12 to $110.
11 a barrel
.

Stephen Innes, managing partner at SPI Asset Management, said: "Oil prices rose
again after heading into the long weekend heading into the United States, due to the recession and concerns about disruption in fuel demand.
”

"In a short-term supply crunch, these global economic concerns appear to be offset
by the prospect of increased demand from the United States and China in the near future.
"

Analysts said supply concerns are boosting the market as Western sanctions on Russian oil and the possible decline in Russian production remain due to sanctions on the production of equipment needed
.

CMC Markets analyst Tina Teng said: "Traders are assessing tight supply and slowing global economic growth, leading to volatility
in trading sessions.
”

"However, recession fears could be a major bearish factor
for the oil market for the rest of the month.
"

Analysts said the push and pull between supply concerns and global growth uncertainty could play out in the market for some time
.

Westpac senior economist Justin Smilk said: "For the rest of the year we will see this tension spread
.
”

Given that the global economy is still recovering from the downturn of the coronavirus pandemic, it is unclear how much risk of demand disruption is
, he said.

"There are fears of a recession, but that's not happening
yet.
We are still experiencing a recovery," Smirk said
.

The release of weekly U.
S.
oil inventory data will be delayed by one day because Monday is the June 11 holiday, the American Petroleum Institute will release oil inventory data for the week ending June 17 on Wednesday, and the Energy Information Administration will release data
on Thursday.