Crude oil prices have slipped after reaching a four-month peak as supply cuts and the US sanctions on Iran and Venezuela continue to support.
International Brent crude oil futures were trading at $68.54 a barrel after touching its highest levels of $68.69 a barrel since 13 November last year, reported Reuters. US West Texas Intermediate (WTI) crude futures dropped 12 cents to $60.11 per barrel. In the earlier session, WTI traded at $60.33 per barrel, its peak levels since 12 November 2018.
Since the beginning of 2019 crude prices continued to edge higher, driven by supply cuts led by the Organization of the Petroleum Exporting Countries (OPEC). OPEC’s crude oil output dropped from 32.8 million barrels per day (bpd) in mid-2018 to 30.7 million in February. Ongoing US sanctions against prominent oil producers Iran and Venezuela also continued to support.
ANZ bank was quoted by Reuters as saying: “Venezuelan exports to the U.S. have finally dried up, after the sanctions were placed on them by the U.S. administration earlier this year.”
Oil supplies from Iran also dropped as the US has planned to reduce its crude exports by around 20% by forcing other countries to reduce their imports from the Middle Eastern country.
Global oil prices also received support from falling US crude oil stockpiles. According to Energy Information Administration, the inventories dropped by 9.6 million barrels to 439.5 million barrels.The fall is primarily attributed to soaring US exports which stood at 3 million barrels per day (Mbpd), nearly double compared to 2018 levels.