Oil prices have ‘edged above’ $71 a barrel over concerns of many supply threats due to declining Venezuelan and Iranian exports and escalating crisis in Libya.
Indications that the US will implement tougher sanctions on key oil producers Iran and Venezuela have prevented the oil prices from further losses.
Brent crude was up 19 cents to $71.37 a barrel, while US West Texas Intermediate (WTI) crude gained 30 cents to $63.70 per barrel, reported Reuters.
Swiss bank Julius Baer Norbert Ruecker was quoted by Reuters as saying: “Collapsing Venezuelan oil output and sanctioned Iranian exports have a put big question mark over supply.
“With the many supply threats, the market mood turns more bullish by the day and this should support prices over the coming weeks.”
However, the rise in oil prices was curbed from increasing further by expectations of higher US inventories and Russia’s willingness to comply with supply cuts led by the Organization of the Petroleum Exporting Countries (OPEC).
Analysts expect US crude stockpiles to have increased by 1.9 million barrels last week, according to Reuters.
The OPEC and other producers including Russia, jointly known as OPEC+, has committed to reduce output by 1.2 million barrels per day for six months starting 1 January 2019. The deal has boosted Brent crude prices by more than 30% in 2019.
OPEC+ is scheduled to meet in June to decide on the future of the ongoing supply cut deal. If the deal is not renewed, Russia may decide to increase output to bolster its global market share, TASS news agency reported citing Russian Finance Minister Anton Siluanov.