LONDON (Reuters) – Oil prices rose on Thursday, squeezing profits after signs of serious disruptions in crude oil deliveries from Iran and Venezuela and a decline in US crude oil inventories.
A pump-jack works at sunset in an oil field in Midland, Texas USA August 22, 2018. Image from August 22, 201
Benchmark Brent crude LCOc1 rose 30 cents a barrel at $ 77.44 at 0745 GMT. U.S. light raw CLc1 was 30 cents higher at $ 69.81.
Brent has risen nearly 10 percent in the past two weeks, after seeing generally that the global oil market is getting tighter and could run short over the next few months as US sanctions restrict Iran's crude oil exports.
"Sanctions against Iran are affecting oil supplies and increasing crude oil prices," said Alfonso Esparza, analyst at futures brokerage OANDA.
Iran's crude oil exports are expected to fall to just over 2 million barrels a day (bpd) in August, while peaking at 3.1 million barrels a day in April as importers bow to American pressure to reduce orders ,
The Organization of Petroleum Exporting Countries, of which Iran is the third-largest producer, will debate in December whether it can compensate for a sudden decline in Iran's supply after the sanctions were imposed in November, head of state oil marketer SOMO, Alaa al-Yasiri said Wednesday.
The crude oil exports of the crisis-ridden OPEC member Venezuela have fallen sharply and have halved in recent years to around 1 million barrels per day.
Official US oil inventory data on Wednesday also contributed to the uptrend.
U.S. Commercial Crude Oil Stocks USOILC = ECB fell 2.6 million barrels a week to 24 August to 405.79 million barrels, more than projected, the Energy Information Administration said.
U.S. Production C-OUT-T-EIA was flat from the previous week's record of 11 million bpd.
The International Energy Agency (IEA) warned of a worsening market towards the end of the year due to a combination of declining supply in countries such as Iran and Venezuela and strong demand, especially in Asia.
"There are certainly some fears that the oil markets could worsen towards the end of the year," IEA Executive Director Fatih Birol told Reuters on Wednesday.
BNP Paribas global oil strategist Harry Tchilinguirian saw a combination of supply risks:
"As Iran's oil exports are lost to the market, Venezuelan production continues to decline, Angola struggles to maintain production, and Libya is subject to episodic failures," said Tchilinguirian vs. Reuters Global Oil Forum.
"The path of least resistance (for prices) is up, at least in our view."
US oil drilling, production and warehousing: tmsnrt.rs/2OKP4nJ
Venezuela Crude Oil Exports: tmsnrt.rs/2LvCPtl
Reporting by Christopher Johnson in LONDON and Henning Gloysteinin SINGAPORE; Edited by Dale Hudson