Oil Traders Raise Upside Bets on Supply FearsThe latest CFTC COT institutional positioning report shows that oil traders increased their net long position last week for the first time in well over a month. The increase in upside exposure is likely a reflection of resurgent fears over the path the conflict in Ukraine is taking. With peace talks having failed to produce a ceasefire and with reports of further Russian atrocities having occurred, the violence has stepped up again over the last week or so as Russia launches a fresh offensive. The market is clearly sensitive to the upside risks for oil stemming from the conflict, keeping oil prices bid for now.Russia In FocusOil prices have been firmly underpinned this week, with the 95.93 level continuing to act as a floor. News that Russia has terminated gas supply to Poland and Bulgaria and is also threatening to cut off any other European countries which don’t agree to pay in Rubles, is putting fresh emphasis on tight energy supply. EU leaders met yesterday to discuss the move by Russia as well as possible countermeasures.EU to Block Russian Oil?Since the invasion of Ukraine began, there has been a growing call for the EU to ban Russian energy imports. While no agreement has been reached so far, Germany has voiced strong support for such a move and has laid out plans to achieve independence from Russian oil by the end of the year. Removing Russian energy supply too quickly risks harming the EU economy. However, if the EU begins to gradually phase out Russian energy supply it risks losing supply altogether anyway if Russia reacts aggressively. As such, discussions continue for now.EIA Reports Distillate Inventories At 2008 LowsThe latest report from the Energy Information Administration this week showed that US commercial crude stores rose by 0.7 million barrels last week. This was greater than the 0.1 million barrel surplus expected and comes on the back of a huge 8 million barrel drawdown the prior week, suggesting that supply/demand was much more balanced this past week. Meanwhile, distillate inventories (including diesel and heating oil) fell to their lowest level since 2008 as refiners continue to struggle to meet demand.Technical ViewsCrude OilFor now, oil prices continue to hold in triangle formation atop the 95.93 support. Price is hovering around the bull channel top and, while the 95.93 level holds as support, a further push higher cannot be ruled out. A break of 106.05 will put the focus on 114.71 and 121.56 above. To the downside, should we slip back under the 95.93 level, 83.75 is the next key support to note, with the channel low coming in around that level also.