London — Oil prices rose slightly on Thursday as investors assessed the likelihood of further U.S. sanctions against Russia and the supply risks posed by a blockade of Venezuelan oil tankers.
Brent crude rose 32 cents or 0.54% to $60 per barrel at 0910 GMT. U.S. West Texas Intermediate crude was up 38 cents, or 0.68%, at $56.32 per barrel.
U.S. intentions to impose more sanctions against Russia and its threatened blockade of tankers under sanctions and carrying Venezuelan oil pushed prices higher, PVM analyst John Evans said.
On Wednesday, Bloomberg reported that the U.S. is preparing another round of sanctions on Russia’s energy sector in the event Moscow does not agree to a peace deal with Ukraine, citing people familiar with the matter. A White House official told Reuters President Donald Trump had not made any decisions on Russian sanctions.
Further measures targeting Russian oil could pose an even bigger supply risk to the market than Trump’s announcement on Tuesday that the U.S. would blockade tankers under sanctions entering and leaving Venezuela, ING analysts said in a note.
The Venezuela blockade could affect 600,000 barrels per day of Venezuelan oil exports, mostly to China, but 160,000 bpd of exports to the U.S. would likely continue, ING said. Chevron vessels were continuing to depart for the U.S. under a previous authorisation from the U.S. government.
Most other Venezuelan exports remained on hold on Wednesday, although state oil company PDVSA restarted loading crude and fuel cargoes after suspending operations because of a cyberattack, sources and customs data indicated.
It was not clear how a U.S. blockade would be enforced. The U.S. Coast Guard last week took the unprecedented step of seizing a Venezuelan oil tanker and sources said the U.S. was preparing for more such interdictions.
Venezuelan crude makes up around 1% of global supplies.
*Enes Tunagur, Colleen Howe; editing: Barbara Lewis – Reuters
This article was originally posted at sweetcrudereports.com
Be the first to comment