Crude oil prices drifted further away from recent highs Thursday as geopolitical spats over sanctions put Russia on the offense about oil production.

Oil prices moved lower in recent sessions as markets readjust after the U.S. hurricanes upended the energy sector in the world's largest economy. The U.S. Energy Information Administration reported Wednesday that domestic oil inventories declined 2.4 million barrels, larger than an estimate from the analysts surveyed by S&P Global Platts, but far less than the 5.1 million draw reported by the American Petroleum Institute a day earlier.

Inventories matter for traders looking at the surplus on the five-year average in global crude oil inventories. The Organization of Petroleum Exporting Countries and a handful of big producers like Russia are working to drain the surplus with coordinated production cuts, and that effort helped pull oil markets from the bottom reached in early 2016.

Russian Energy Minister Alexander Novak was defiant in the face of tightened U.S. sanctions that target the country's energy sector. The Kremlin said recently that sanctions were cover for U.S. efforts to tap into the European energy market and Novak said Thursday the Russian energy sector was unfazed by the latest push.

"On the whole, it is not going to affect Russia's production," he was quoted by Russian news agency Tass as saying.

Russia is the largest contributor to the production cut agreement that's not a member of OPEC.

The price for crude oil was lower early Thursday. Brent crude oil, the global benchmark, was down 0.3 percent at 9:20 a.m. EDT to $60.29 per barrel. West Texas Intermediate, the U.S. benchmark for the price of oil, was barely changed, up just 0.04 percent to $54.32 per barrel.

Markets overall may be reacting Thursday to a decision by the Bank of England to raise its key policy rate to 0.5 percent in an effort to market a 2 percent inflation target, but added a note of caution about the road ahead as the country charts a path out of the European Union.

"Monetary policy cannot prevent either the necessary real adjustment as the United Kingdom moves towards its new international trading arrangements or the weaker real income growth that is likely to accompany that adjustment over the next few years," it said.

For markets, the push above $60 per barrel represents new territory for oil, but the situation may be cooling off. An emailed morning fundamentals report from London oil broker PVM said at least some of the rally was supported by temporary factors.

"The aftershock of the U.S. hurricane season was still felt last month in the form of falling production and falling product stocks," the report read. "The rise of geopolitical premium also contributed to the jump in oil prices."

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China lends hand to Russian LNG projects
Washington (UPI) Nov 1, 2017
Russian independent gas producer Novatek said Wednesday it reached an agreement with a Chinese bank to help implement a Arctic liquefied natural gas project. Novatek said it signed a memorandum of understanding with the China Development Bank to cooperate on steering capital toward LNG. "Our strategy envisages a rapid growth of LNG production using international financing sources ... read more

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