Reuters – Oil prices rose on Wednesday, pushed up by ongoing supply cuts from producer group OPEC and by U.S. sanctions against Iran and Venezuela.
International Brent crude oil futures were at $66.95 a barrel at 0751 GMT, up 28 cents, or 0.4 percent, from their last close.
U.S. West Texas Intermediate (WTI) crude futures were at $57.23 per barrel, up 36 cents, or 0.6 percent, from their last settlement.
Oil prices have been pushed up this year by supply cuts led by the Middle East-dominated producer group of the Organization of the Petroleum Exporting Countries (OPEC).
Markets have been further tightened by the implementation of U.S. sanctions against oil exports from OPEC-members Iran and Venezuela.
In Venezuela, the worst blackout on record has left most of the South American country without power for six days, leaving hospitals struggling to keep equipment running, food rotting in the tropical heat and exports from the country’s main oil terminal stranded.
“Failures in the electrical system … (are) likely to accelerate the loss of 700,000 barrels per day” in oil supply, Barclays bank said.
Oil futures bucked the trend of falling stock markets on Wednesday, with a ‘risk-off’ mood settling on markets amid a gloomy economic outlook and concerns about a disorderly exit of the European Union by Britain.
“The downbeat mood … in Asia saw stocks decline, and European futures are also pointing to a softer start,” said Jasper Lawler, head of research at futures brokerage London Capital Group.
Even in oil not all indicators point to an ever-tighter market.
National Australia Bank (NAB) said the oil market outlook was mixed, with downside price risk coming from economic growth concerns and strong oil supply growth from the United States, with OPEC’s supply cuts and the U.S. sanctions against Iran and Venezuela acting as price drivers.
“On balance, we see a very gradual uptrend for oil this year, with Brent forecast to reach $70 per barrel by the end of the year,” NAB said.
U.S. crude oil production is expected to average about 12.30 million bpd in 2019, the U.S. Energy Information Administration (EIA) said on Tuesday.
That’s up from an average of around 11 million bpd in 2018.
Reporting by Henning Gloystein in SINGAPORE and Colin Packham in SYDNEY; Editing by Richard Pullin and Joseph Radford