Venezuela, Saudi Oil Output Slumps, Says OPEC

Venezuela, Saudi Oil Output Slumps, Says OPEC”

Brent and WTI crude oil futures have risen by more than 30 per cent and 40 per cent respectively since the start of the year.

Fighting in Libya has added to a long list of factors boosting oil prices, including OPEC supply cuts and U.S. sanctions on Iran and Venezuela.

Worldwide benchmark Brent futures were at $70.66 per barrel at 0158 GMT, up 5 cents from their last close. U.S. West Texas Intermediate crude oil futures rose 64 cents, or 1%, to $64.62 per barrel, holding just below their strongest level since November.

On Tuesday, the 9th of April 2019, during the midday Asia Pacific trading hours, Brent crude hit a five-month high above $71, while United States crude had resurfaced over $64.50 level for the first time after November 1st, 2018.

Oil prices rose to their highest level since November 2018 on Monday, driven upwards by OPEC's ongoing supply cuts, USA sanctions against Iran and Venezuela, fighting in Libya as well as strong data.

"With geopolitical risks continuing to impact production from Venezuela and Iran and now also potentially Libya and even Algeria, the crude oil market is likely to remain supported until the price reaches a level that is satisfactory for OPEC and Russian Federation", said Ole Hansen, commodity strategist at Saxo Bank.

An OPEC monthly report released on Wednesday showed that Venezuela's oil output sank last month to a long-term low below 1 million barrels per day, due to USA sanctions and blackouts.

The U.S. sanctions on Iran and Venezuela also caused supply declines in these countries, which are forecast to see their outputs decrease further. "Declines from these two exempt countries account for nearly 47 percent of the reduction seen from OPEC", ING said.

Despite the OPEC-led cuts and US sanctions, not all regions are in tight supply.

The OPEC monthly report released on Wednesday showed that Venezuela's oil output sank last month to a long-term low below 1 million barrels per day, due to USA sanctions and blackouts.

According to the Department of Energy, America's stores of commercial crude oil rose by 7.0m barrels over the week ending on 5 April to reach 456.5m barrels (consensus: 2.3m b/d), leaving them at their average level of the past five years.

"U.S. crude oil inventories remain stubbornly high", it added.

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