Oil near three-week high on supply fears, U.S. stocks drop
Shafaq News/ Oilprices edged higher on Wednesday on supply concerns with the U.S. stepping upefforts to limit Venezuelan and Iranian oil exports, while abigger-than-expected drop in U.S. crude inventories also lent support.
Brent crude futures gained 20 cents, or 0.3%, to $73.22 abarrel by 0404 GMT, while U.S. West Texas Intermediate crude futures rose 20cents, or 0.3%, to $69.20 a barrel.
Both contracts hit their highest in three weeks in theprevious session.
"Crude oil prices maintain their bullish bias afterTrump's sanctions on Venezuelan oil, raising supply-side concerns,"Priyanka Sachdeva, a senior market analyst at Phillip Nova, wrote in a marketcommentary on Wednesday.
On Monday Trump signed an executive order authorizing hisadministration to impose blanket 25% tariffs under the 1977 InternationalEmergency Economic Powers Act on imports from any country that buys Venezuelancrude oil and liquid fuels.
Oil is Venezuela's main export. China, already a target ofU.S. import tariffs, is its largest buyer.
Trade of Venezuelan oil to top buyer China stalled onTuesday, as Chinese traders and refiners said they were waiting to see how theorder would be implemented and whether Beijing would direct them to stopbuying.
Washington also imposed a new round of sanctions on Iran'soil sales last week, targeting entities including Shouguang LuqingPetrochemical, a "teapot" or independent refinery in east China'sShandong province, and vessels that supplied oil to such plants in China, thetop buyers of Iranian crude.
The market was also buoyed by American Petroleum Institutedata that showed U.S. crude inventories fell by 4.6 million barrels last week,a sign of healthy demand for fuel in the world’s largest economy.
Analysts polled by Reuters were expecting a decline of 1million barrels.
Official U.S. government data on crude inventories is due onWednesday.
The upswing in oil prices is temporary, Phillip Nova'sSachdeva said, with the potential economic slowdown due to Trump's tariffskeeping a lid on price gains.
Further capping oil prices, the U.S. reached deals withUkraine and Russia to pause attacks at sea and against energy targets, withWashington agreeing to push to lift some sanctions against Moscow.
Kyiv and Moscow both said they would rely on Washington toenforce the deals, while expressing scepticism that the other side would abideby them.
(REUTERS)
