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Business News/ Markets / Commodities/  Oil prices tad up on anticipation of fresh US sanctions on Venezuela
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Oil prices tad up on anticipation of fresh US sanctions on Venezuela

The reimposition of sanctions could also disrupt India's plans to acquire oil from Venezuela in exchange for dividends.

Benchmark global prices have increased 23% since mid-December, recently nearing their 2023 highs. (Image: Pixabay)Premium
Benchmark global prices have increased 23% since mid-December, recently nearing their 2023 highs. (Image: Pixabay)

NEW DELHI:Global crude oil prices edged marginally higher on Thursday, rebounding from a 3% drop the previous day, as concerns over demand and escalating tensions between Iran and Israel potentially impacting the oil market continue to trouble investors.

As of 10:54 am, the June Brent contract on the Intercontinental Exchange was trading at $87.52 per barrel, a 0.26% increase from the previous close. Similarly, the May contract of West Texas Intermediate on NYMEX had risen by 0.17% to $82.83 per barrel.

Meanwhile, the US administration has reimposed restrictions on Venezuelan oil, that may hamper  supplies from the country. At the same time, new sanctions on Iranian oil were included as part of a foreign aid package released by House Republicans that is slated for a floor vote later this week, agencies reported.

The reimposition of sanctions could also disrupt India's plans to acquire oil from Venezuela in exchange for dividends. State-run ONGC Videsh Ltd had planned to source oil from Venezuela in lieu of stuck dividends worth $600 million for its 40% stake in the San Cristobal field, as reported by Mint earlier.

According to data from the US Energy Information Administration (EIA), oil inventories in the US saw an increase of 2.7 million barrels to 460 million barrels for the week ending 12 April.

The International Energy Agency (IEA) has adjusted its global oil demand growth forecast in its latest monthly report. The revision decreases the forecast by about 100,000 barrels per day to 1.2 million barrels per day, following exceptionally weak deliveries in OECD countries at the beginning of the year. The IEA predicts that growth will slow further to 1.1 million barrels per day next year as the post-pandemic recovery wanes.

Traders had already accounted for the risk of further escalation in the Iran-Israel conflict, which led to a softening of prices on Wednesday. Investors are closely monitoring Israel's potential response to Iran's recent missile and drone attacks.

However, with ongoing tensions in West Asia, volatility in the energy market is expected to continue.

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Published: 18 Apr 2024, 12:17 PM IST
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