SINGAPORE (Reuters) – Brent oil rose for the sixth day on Tuesday, pbading $ 75 a barrel, on expectations that supplies will tighten because fuel is rising at the same time that the United States can impose sanctions on Iran. and the OPEC-led production cuts remain in place
Brent's six-day uptick is the highest since a similar series of gains in December and has increased by more than 20 percent since its 2018 low in February.
U.S. West Texas Intermediate (WTI) crude futures CLc1 were at $ 68.98 per barrel, up 34 cents, or 0.5 percent since their last deal. On Thursday, the WTI rose to $ 69.56, the largest amount since November 28, 2014.
Markets have been lifted by supply cuts led by the Organization of the Petroleum Exporting Countries (OPEC) that were introduced in 2017 with the aim of propping up the market.
The potential to renew US sanctions against Iran is also pushing prices up.
Stephen Innes, head of Asia / Pacific operations at futures broker OANDA, said new sanctions against Tehran "could boost oil prices to $ 5 a barrel."
The United States has until May 12 to decide whether to abandon Iran's nuclear agreement and to re-impose sanctions against the third largest producer of OPEC, which would further strengthen world supplies.
"Crude prices are now at the highest levels in three years, reflecting current concerns about geopolitical tensions in the Middle East, which is the source of almost half of the world's oil supply," said the ANZ bank.
OPEC's efforts to adjust the markets are led by the main exporter Saudi Arabia, where state oil company Saudi Aramco is pushing for higher prices before a partial inclusion scheduled for later this year or 2019.
"The strength of the oil is coming from Saudi Arabia's recent commitment to recover oil between $ 70 and $ 80 per barrel, as well as inventory levels that are in the normal range," said William O & Lunglin, investment badyst at Rivkin Securities of Australia.
OPEC supply restrictions and the threat of new sanctions are occurring just as demand in Asia, the world's largest oil-consuming region, has reached a record as new and more expanded refineries start from China until Vietnam.
One of the few factors that causes oil prices to rise further is US production, which has soared by more than a quarter since mid-2016 to more than 10.54 million barrels per day (bpd) , surpbading Saudi Arabia's production of around 10 million bpd.
As a result of its rising production, US crude is appearing more and more in world markets, from Europe to Asia, which undermines OPEC's efforts to tighten the market.
(Graph: Asia crude oil demand – reut.rs/2K2V89x)
(Graph: Russia vs. Arabia versus US oil production – reut.rs/2JlrzPq)
Reports by Henning Gloystein; Edition by Joseph Radford and Christian Schmollinger
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