OPEC-led supply cuts supports oil price. Credit: Don Barrett.

Global oil prices have edged up due to ongoing supply cuts by OPEC and US sanctions against exporters Iran and Venezuela.

However, concerns of economic slowdown to dent oil demand also continue to weigh down the prices.

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International Brent crude oil futures gained 20 cents to trade at $71.03 per barrel, while the US West Texas Intermediate (WTI) crude futures jumped by 24 cents to $63.82 a barrel, Reuters reported.

The global oil market rebounded by nearly one-third this year driven by Organization of the Petroleum Exporting Countries (OPEC) led supply cuts. The oil cartel, along with other participating allies, is scheduled to meet in June this year to decide on extending the deal.

Due to sanctions, output from Venezuela dropped. The US is expected to implement oil sanctions against Iran in May, further tightening the market.

“Electrical outages added a further hurdle to Venezuelan production, which fell by 290,000bpd in March to 732,000bpd.”

Jefferies bank was quoted by the news agency as stating: “Electrical outages added a further hurdle to Venezuelan production, which fell by 290,000 barrels per day in March to 732,000 barrels per day. Iranian production was stable at 2.7 million barrels per day, (but) could take a further hit if the US cuts import waivers in May.”

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Concerns of China’s economic slowdown restrict the price from inching further.  The country’s economic growth is predicted to decelerate this year to nearly a three-decade low of around 6.2% this year, according to a Reuters poll.

Currently, most of the world’s growth in fuel consumption is accounted to Asia.

RBC Capital Markets as quoted as saying: “China and India comprise nearly 55% of global demand growth.

“Throw in the rest of emerging Asia and the figure balloons to 80%.”