Oil prices slightly increased on Wednesday as supply concerns grew amid US efforts to curb Venezuelan and Iranian exports, while a larger-than-expected drop in US crude inventories added support.
The international benchmark, Brent crude, increased by around 0.1% trading at $72.66 per barrel at 11.41 a.m. local time (0841 GMT), up from $72.59 at the previous session’s close.
The US benchmark, West Texas Intermediate (WTI) rose by about 0.12%, settling at $69.15 per barrel, compared to its prior session close of $69.07.
US President Donald Trump signed an executive order on Monday imposing tariffs on countries importing Venezuelan oil.
According to the order, starting April 2, a 25% tariff may be imposed on all goods imported into the US from any country that imports Venezuelan oil, whether directly from Venezuela or indirectly through third parties.
China, already a target of US import tariffs, criticized the move, as it, along with India, is one of the biggest buyers of Venezuelan crude aside from the US.
Last week, Washington also imposed a new round of sanctions on Iran’s oil sales, targeting 19 entities and vessels linked to Iranian oil exports, including a Chinese oil terminal for purchasing and storing Iranian crude from a sanctioned vessel.
US sanctions are raising concerns about potential disruptions in global oil supply chains and prices continue to show a bullish trend.
Meanwhile, the American Petroleum Institute reported a 4.6 million-barrel fall in US commercial crude oil stocks last week, surpassing market expectations of a 2.5 million-barrel decline. The significant inventory drawdown suggests strengthening demand.
Market participants will closely watch upcoming reports from the US Energy Information Administration for further confirmation of these trends and their potential impact on prices.
However, price increases were limited as traders assessed the latest efforts toward a ceasefire in the Russia-Ukraine war.
The US reached deals with Ukraine and Russia to pause attacks in the Black Sea and on each other’s energy infrastructure.
A potential truce between Russia and Ukraine could lead to an easing of US and European restrictions on Moscow’s oil industry.
Additionally, growing concerns over economic slowdown due to Trump’s tariffs also restrained price gains.
