Oil Prices Edge Up Amid Supply Risks and OPEC+ Concerns
Oil prices inched up on Wednesday. Investors weighed supply risks after the US decided to bar Chevron from exporting crude from Venezuela. Brent crude futures rose 7 cents, or 0.1%, to $64.16 a barrel, while US West Texas Intermediate crude gained 9 cents, or 0.2%, to $60.98 a barrel.
Venezuela Sanctions Impact
The Trump administration’s new authorization for Chevron allows the company to maintain assets in Venezuela. However, it prohibits oil exports and expansion. This move may lead to refiners relying more heavily on Middle Eastern crude, according to Westpac’s Robert Rennie.
OPEC+ Meeting Expectations
However, price gains were limited due to expectations that OPEC+ will increase output at a meeting this week. Market watchers anticipate no policy change, with a potential July output hike to be discussed on Saturday.
Market Analysis
“Oil prices have moved only marginally in the last couple of sessions.” The industry is largely bracing for an oversupplied second half of the year. Priyanka Sachdeva, a senior market analyst at Phillip Nova, said this. Sachdeva also noted that OPEC members’ non-compliance with production quotas and Trump’s trade policies negatively impact global oil demand.
Additional Market Support
The market received some support after Trump mentioned potential new sanctions on Russia, which could put Russian energy flows at risk, according to ING commodities strategists
