Oil rose about 4% as U.S. gasoline prices jumped to record highs.

Oil prices rose about 4% on Friday as U.S. gasoline prices jumped to record highs, China appeared poised to ease restrictions on the pandemic and investors worried about tightening Russian oil supplies if the European Union banned Russia.

Brent crude futures rose $4.10, or 3.8 percent, to settle at $111.55 a barrel. U.S. West Texas Intermediate (WTI) crude gained $4.36, or 4.1 percent, to settle at $110.49.

It was WTI’s highest close since March 25 and its third straight weekly gain. Brent crude fell for the first time in three weeks.

U.S. gasoline futures surged to a record high after inventories fell last week for a sixth straight week. That pushed gasoline crack spreads, a measure of refining margins, to their highest since April 2020, when WTI closed in negative territory. [EIA/S]

“There has been no increase in (U.S.) gasoline storage since March,” said Robert Yawger, executive director of Mizuho Energy Futures, noting that gasoline demand is expected to surge when the summer driving season begins over the U.S. Memorial Day holiday weekend.

The 3:2:1 U.S. crack spread, another measure of refining margins that includes gasoline and diesel, rose to record levels, according to Refinitiv data going back to May 2021.

U.S. gasoline prices rose to record highs on Friday, at $4.43 a gallon for gasoline and $5.56 a gallon for diesel, the auto club AAA said.

Oil prices have been volatile on fears that a possible EU ban on Russian oil could tighten supplies, but have also been pressured by fears that a resurgence of the COVID-19 outbreak could cut global demand.

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“The EU embargo, if fully implemented, could take some 3 million bpd of Russian oil offline, which would completely disrupt and ultimately alter global trade flows, causing market panic and extreme price volatility,” said Rystad Energy analysts. Louise Dixon.

This week, Moscow imposed sanctions on several European energy companies, raising concerns about supply. [NG/EU]

In China, where authorities have pledged to support the economy, city officials said Shanghai will begin easing coronavirus traffic restrictions and opening stores this month.

“Crude oil prices rose on optimism that the COVID situation in China did not worsen and risk assets rebounded,” said Edward Moya, senior market analyst at data and analytics firm OANDA.

Global stock markets rose after a week of volatile trading, pushing up U.S. and European stock indexes.

Crushing oil prices this week, inflation and higher interest pushed the dollar to a near 20-year high against a basket of currencies, making oil more expensive to buy in other currencies.

The European Union says enough progress has been made in restarting talks with Iran. The U.S. expressed appreciation for the EU’s efforts, but said a deal had not been reached and it was uncertain whether it would. [nL2N2X51LE]

Analysts said a deal with Iran could add another 1 million bpd to the market.

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(This story has not been edited by NDTV staff and was automatically generated from the syndicated feed.)

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