Global oil prices increased buoying on rising crude imports of China and supported by ongoing US sanctions against Iran and Venezuela.
Brent crude oil futures jumped 43 cents to $70.31 per barrel while US West Texas Intermediate (WTI) crude futures gained 56 cents to trade at $61.96 per barrel, Reuters reported.
According to data released by the Chinese General Administration of Customs, crude oil imports in the country increased to 10.64 million barrels per day (Mbpd) in April 2019. This is an increase of 11% compared to the April 2018.
China, which is the largest oil importer in the world, imported around 10.03 Mbpd on an average in the first four months of 2019.
The report of increase in imports comes at a time when supplies to the oil market are already tightened due to sanctions on key petroleum producers Iran and Venezuela. Oil exports from Iran are expected to drop further this month from around one Mbpd in April after the US revoked all exemptions placed on some governments to buy Iranian crude.
Supplies are further squeezed as the Organization of the Petroleum Exporting Countries (OPEC) and other aligned countries have been restricting output since the beginning of 2019.
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OPEC is scheduled to meet next month to discuss the future of its output policy. In the meantime, the US has asked Saudi Arabia to increase production to improve supplies to the market.
The market is also concerned about the ongoing trade dispute between the US and China. Commenting on the trade war, London Capital Group research head Jasper Lawler told Reuters: “The focus now will be on the two days of talks in Washington scheduled to take place between US and Chinese officials.”