Oil extends gains on Russia-Europe tension, China stimulus hopes

Oil prices extended gains in early Asian trade on Wednesday as geopolitical tensions simmered with Russia warning of gas supply cuts to Poland and Bulgaria while hopes of Chinese economic stimulus buoyed oil demand outlook.

Brent crude futures rose $1.27, or 1.2 per cent, to $106.26 a barrel by 0143 GMT. US West Texas Intermediate crude futures rose $1.11, or 1.1 per cent, to $102.81 a barrel.

Crude prices settled about 3 per cent higher on Tuesday in volatile trade as the market is torn between supply and demand concerns over Russian oil and gas disruption and a worsening global economic outlook.

Russia’s Gazprom has told Poland and Bulgaria it will halt gas supplies from Wednesday,