Oil surges on threat to PDVSA, Iran worries

Oil prices rose to their highest levels since late 2014, as Brent crude oil futures reached $75.81/bbl.

Offshore staff

NEW YORK– Oil prices rose to their highest levels since late 2014 on Monday, boosted by the latest troubles for Venezuelan oil company PDVSA and a looming decision on whether the United States will re-impose sanctions on Iran, according to Reuters.

Brent crude oil futures reached $75.81/bbl, while West Texas Intermediate (WTI) crude futures rose to $70.40/bbl, the first time since November 2014 that WTI had climbed above $70/bbl.

China’s Shanghai crude oil futures, launched in March, broke their dollar-converted record high, touching $72.54/bbl.

US oil major ConocoPhillips has moved to take Caribbean assets of Venezuela’s state-run PDVSA to enforce a $2 billion arbitration award, three sources told Reuters. The move could deal a further blow to the company’s declining oil output and exports. Venezuela’s oil output has halved since the early 2000s to 1.5MMb/d, hit by a lack of investment.

Also boosting prices is the widespread expectation that US President Donald Trump will withdraw from the Iranian nuclear pact. Trump has a May 12 deadline to determine whether to extend sanction waivers.

05/07/2018

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