Oil prices climbed over 1.5% on Wednesday after U.S. President Donald Trump announced a “total and complete” blockade on all sanctioned oil tankers travelling to and from Venezuela, stoking renewed geopolitical tensions amid ongoing demand concerns.
Brent crude futures gained 87 cents, or 1.5%, to trade at $59.79 per barrel by 0730 GMT, while U.S. West Texas Intermediate crude advanced 85 cents, also up 1.5%, to $56.12 per barrel. However, crude oil prices remain below $60 per barrel.
“Crude oil extended its decline and made 5 years low in international market amid progress in Russia–Ukraine peace negotiations and weaker-than-expected U.S. economic data. Reports that Ukraine has shared a revised peace proposal with the U.S. raised expectations of a ceasefire, which could lead to increased Russian oil supplies in global markets. Additionally, softer U.S. retail sales and ADP employment data added pressure on prices,” said Rahul Kalantri, VP Commodities, Mehta Equities Ltd.
What’s driving the crude oil prices?
Oil prices closed near five-year lows in the previous session as progress in Russia–Ukraine peace negotiations raised expectations that Western sanctions on Moscow could be relaxed, potentially increasing supply at a time when global demand remains weak.
Meanwhile, former US President Donald Trump on Tuesday ordered a blockade on all sanctioned oil tankers entering or exiting Venezuela, stating that he now considers the country’s leadership a foreign terrorist organisation.
Despite these developments, Asian crude traders noted that renewed buying in futures—after prices fell below $60 a barrel a day earlier—also played a significant role in lifting oil prices on Wednesday.
“The price is sentiment-driven by the Venezuelan news for today, but overall, export volumes from Venezuela are relatively small in the global supply share. With all eyes on the Russia-Ukraine discussions, the market is still under downside risk,” a trader was quoted as saying by Reuters.
Crude oil prices outlook
Rahul Kalantri expects crude oil prices to remain volatile in today’s session.
“Crude oil is having support at $55.15-54.50 and resistance is at $57.20-58.00 in today’s session. In INR crude oil has support at ₹5,000,-4,940 while resistance at Rs5,150-5,215,” Kalantri said.
(This is a developing story)
Disclaimer: This story is for educational purposes only. Please consult with an investment advisor before making any investment decisions.
