Oil prices climbed over 7% on Thursday, continuing a series of wild daily swings, as the market rebounded from several days of losses on renewed focus on supply shortages in coming weeks due to sanctions on Russia.

Oil benchmarks in recent weeks have experienced their most volatile period since mid-2020. After sliding as buyers cashed in on the run-up, prices resumed their upward trend on expectations that shortages will soon squeeze the energy market.

Benchmark Brent crude futures gained $8.23, or 8.4%, to $106.25 a barrel by 11:45 a.m. EDT (1545 GMT). U.S. West Texas Intermediate (WTI) crude was up $7.42, or 7.8%, to $102.46 a barrel.

Numerous nations have banned purchases of Russian oil after that nation invaded Ukraine nearly three weeks ago. Russia, which calls the action a "special operation," is the world's biggest exporter of crude oil and fuel products. Refiners and end-users must make quick adjustments for coming weeks.

"Both supply and demand are hurting but supply is currently hurting more and a tight oil market for the coming two quarters is to be expected," bank SEB said.

The International Energy Agency (IEA) said 3 million barrels per day (bpd) of Russian oil and products could be shut in from next month. That loss would be far greater than an expected drop in demand of 1 million bpd from higher fuel prices, the IEA said.

Morgan Stanley raised its Brent price forecast by $20 for the third quarter to $120 a barrel, predicting a fall in Russian production of about 1 million bpd from April.

The bank noted that loadings continue at Russian ports, but the share with "destination unknown" is rising. Also, there are more Russian tankers on the water as these exports are "starting to struggle to find a market."

The supply squeeze will more than offset a downward global demand revision of about 600,000 bpd, the bank said.

On Wednesday, prices sagged after government data showed U.S. crude inventories climbed 4.3 million barrels last week, contrary to analysts' expectations for a 1.4 million barrel decline.

The oil market largely shrugged off Wednesday's expected decision by the U.S. Federal Reserve to raise interest rates by one-quarter of a percentage point.

Sentiment was somewhat boosted after China pledged policies to boost financial markets and economic growth, while a decline in new COVID-19 cases there spurred hopes lockdowns will be lifted and factories will resume production.