As IEA advises energy conservation, oil prices rise due to Russia-Ukraine tensions.

• On Monday morning, during Asia trading, crude futures rose by over 3% with Brent crude priced at $111.46 and U.S. futures at $108.25.
• In recent weeks, oil prices have fluctuated wildly, reaching unprecedented heights in March before plummeting by over 20% last week to hover below $100. However, they rebounded once more in the latter half of last week.
• Peace talks between Ukrainian and Russian officials have been ongoing but have not resulted in significant concessions.
• The IEA called for emergency measures to reduce oil usage on Friday due to tight supply, which caused markets to worry.

On Monday, oil prices increased further due to the lack of progress in Russia-Ukraine talks and ongoing concerns about supply, prompting the International Energy Agency to urge for a reduction in oil demand.

On Monday morning, during Asia trading, crude futures rose by more than 3%. Brent crude was priced at $111.46, while U.S. futures were valued at $108.25.

In recent weeks, oil prices have fluctuated wildly, reaching unprecedented heights in March before plummeting by over 20% last week to hover below $100. However, they rebounded in the second half of last week, surpassing that amount.

On Monday, Mizuho Bank stated that two factors were contributing to the rise in oil prices: the ongoing Russia-Ukraine uncertainty and optimism about China's latest Covid impact being less severe than expected, with anticipation of easing restrictions. Meanwhile, Reuters reported that the key hub of Shenzhen partially reopened on Friday, with five districts resuming work and public transportation.

Despite the lack of progress in previous peace talks between Ukrainian and Russian officials, Ukrainian President Volodymyr Zelenksyy has called for another round of talks with Moscow.

According to an interview with CNN's Fareed Zakaria, Zelenskyy stated that if these attempts fail, it would mean that this is a third world war.

The breakdown of peace talks between Russia and Ukraine caused crude oil prices to increase on Friday, but this gain was not enough to offset the losses earlier in the week, resulting in a 4.25% decline in Brent crude.

The IEA called for emergency measures to reduce oil usage on Friday due to tight supply, which caused markets to worry.

The Russia-Ukraine conflict has caused concerns about supply disruptions due to U.S. sanctions on Russian oil and gas. Additionally, the U.K. and European Union have announced plans to phase out Russian fossil fuels. In 2021, Russia accounted for 11% of global oil consumption and 17% of global gas consumption, and up to 40% of Western European gas consumption, according to statistics from Goldman Sachs.

This week, U.S. President Joe Biden will meet with European Union governments as they contemplate imposing an oil embargo on Russia due to its unprovoked invasion of Ukraine.

The Commonwealth Bank of Australia cautioned on Monday that oil prices have dropped below recent highs due to markets continuing to evaluate the probability of a diplomatic resolution to the Ukraine conflict.

Vivek Dhar, the bank's director of energy commodities research, stated in a note that physical shortages, resulting from current sanctions on Russia, will eventually have a more significant impact on oil price determination.

ANZ Research analysts stated that the industry's inability to fill any potential gap has led to calls for consumption reduction.

According to Reuters, sources revealed that OPEC+ producers are still not meeting their supply quotas, with the alliance falling short by more than 1 million barrels per day in its latest report.

The IEA proposed a 10-point plan to decrease oil demand, which included lowering speed limits for vehicles, allowing employees to work from home up to three days a week, and avoiding air travel for business purposes.

The IEA stated on Friday that the implementation of these measures in advanced economies could reduce oil demand by 2.7 million barrels per day in the next four months, compared to the current levels.