HOUSTON: Oil prices rose on Tuesday for a fifth day on expectations that global supply may tighten after the US announced tariffs on countries that buy Venezuelan crude, although OPEC+ plans to go ahead with an output hike in May limited gains. Brent crude futures were up 46 cents, or 0.6%, at $73.46 a barrel by 1023 GMT. US West Texas Intermediate crude climbed 46 cents, or 0.7%, to $69.57.
Both benchmarks rose more than 1% on Monday after US President Donald Trump announced a 25% tariff on countries importing oil and gas from Venezuela. Oil is Venezuela’s main export and China, which is already the subject of US tariffs, is its largest buyer.
“Oil firmed up on the latest tariff moves by the US, although gains were capped by reports of OPEC+ moving to increase output further in May,” Panmure Liberum analysts said in a note.
The Trump administration also on Monday extended a deadline to May 27 for US producer Chevron to wind down operations in Venezuela. The withdrawal of Chevron’s licence to operate could reduce production in the country by about 200,000 barrels per day, according to ANZ analysts.
Meanwhile, OPEC+, the Organization of the Petroleum Exporting Countries and allies including Russia, will likely stick to its plan to raise oil output for a second consecutive month in May, four sources told Reuters, amid steady oil prices and plans to force some members to reduce pumping to compensate for past overproduction. Last week, the US issued new sanctions intended to hit Iranian oil exports.
Trump also said automobile tariffs are coming soon even as he indicated that not all of his threatened levies would be imposed on April 2 and some countries may get breaks, a move Wall Street took as a sign of flexibility on a matter that has roiled markets for weeks. Russia’s Foreign Minister Sergei Lavrov said on Tuesday that Moscow was willing to strike a new agreement on the safety of shipping in the Black Sea if the United States ordered President Volodymyr Zelenskiy to respect it.
The Black Sea initiative was the priority in discussions at a meeting between US and Russian officials in the Saudi capital Riyadh on Monday, Lavrov added.
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