Oil pushed higher on Tuesday amid tensions in the Middle East, which could weigh on global oil supplies. Not to mention, troubles in Venezuela seem to be contributing to rising oil prices as well.
On Monday, oil took a step back along with most equities. In fact, energy stocks were one of the largest contributors to Monday’s drop.
Overall, tensions between Saudi Arabia and Iran, as well as concerns over Venezuelan crude production, helped to ground prices, and the markets have recovered handily. Iran nuclear tensions will continue to be part of the picture, and the possible reimposition of U.S. oil sanctions should keep the oil bulls happy, at least in the near term.
It’s worth pointing out that oil gained some support from signs that the United States might renew sanctions on Iran, which would in turn slow output from the country. Adding fuel to the fire, President Trump separately told European leaders they must “fix the terrible flaws” in the Iran nuclear deal or the United States would refuse to extend its sanctions relief on the country.
On the other side of the globe, Venezuela has been faced with concerns about its falling crude production. This has also helped boost oil prices. The country’s February output was down by more than half a million barrels from last year, according to the International Energy Agency.
West Texas Intermediate crude was last seen up about 1.8% at $63.15 for the April spot.