oil field in Basra
File photo: A worker walks at Rumaila oil field in Basra, Iraq. Image Credit: REUTERS

Bengaluru: Oil prices plunged as much as 17% after media reports said OPEC producers United Arab Emirates and Iraq said they would support increased production, potentially offsetting some of the supply disruptions caused by sanctions on Russian oil after its invasion of Ukraine.

Brent crude fell more than 17%, or $22, to hit a session low at $105.60 during a sharp selloff. The benchmark crude recovered some losses by 1:03 p.m. EST (1803 GMT) to trade down $13.29, or 10.4%, at $114.69 a barrel. U.S. crude was down $12.01, or 9.7%, at $111.69.

Prices hit session lows after traders cited media reports of an Iraqi minister claiming the country is ready to hike production if OPEC+ requires it to. Reuters could not immediately verify the accuracy of the report.

Financial Times had earlier reported that Yousef Al Otaiba, the UAE's ambassador to Washington, said the country favours increasing production.

"That's not nothing. They can probably bring about 800,000 barrels to the market very quickly, even immediately, bringing us one-seventh of the way there in replacing Russian supply," said Bob Yawger, director of energy futures at Mizuho.

The United Arab Emirates said it would urge fellow states in the OPEC oil producers' cartel to boost output after prices surged following Russia's attack of Ukraine.

"We favour production increases and will be encouraging OPEC to consider higher production levels," ambassador Al Otaiba said in a statement.

"The UAE has been a reliable and responsible supplier of energy to global markets for more than 50 years, and believes that stability in energy markets is critical to the global economy," the statement said.