Oil prices rise 3% on supply concerns

Oil prices rose Wednesday morning following a drawdown in U.S. crude and fuel stockpiles and concerns about slowing demand from China.

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West Texas Intermediate crude futures rose $3.82, or 3.7%, to $106.25 a barrel.

Brent futures rose $3.74, or 3.5%, to $108.71 a barrel. 

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The gains follow news that the European Union is working on new sanctions against Russia for invading Ukraine that will target Moscow’s oil industry, according to Reuters.

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An oil rig drilling a well at sunrise, near Midland, Texas. REUTERS/Ernest Scheyder 

European Commission President Ursula von der Leyen is expected to spell out the plans on Wednesday, officials said.

On the supply side, U.S. crude and fuel stocks fell last week. According to American Petroleum Institute figures, crude stocks fell by 3.5 million barrels for the week, a figure that topped the expected 800,000-barrel drop in a Reuters poll. 

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U.S. government data on stockpiles is due later Wednesday. 

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