Oil prices advanced Thursday, climbing to their highest levels in two weeks, as the United States imposed new sanctions aimed at curbing Iranian oil exports.
As of 09:24 GMT, Brent crude rose 0.82% to $66.39 per barrel, while West Texas Intermediate (WTI) increased 1% to $63.11. Both benchmarks closed 2% higher on Wednesday, setting the stage for their first weekly gain in three weeks.
The rally comes just ahead of the Good Friday and Easter holidays, shortening the week for markets and amplifying investor reactions to geopolitical developments.
U.S. sanctions, announced Wednesday, target Iran’s oil sector with renewed vigor, including measures against a China-based “teapot” refinery. The move aims to intensify pressure on Tehran amid ongoing nuclear negotiations and underscores Washington’s commitment to restricting Iranian crude on the global market.
OPEC Pushes for Output Compliance
In parallel, supply worries deepened after the Organization of the Petroleum Exporting Countries (OPEC) confirmed it had received revised plans from Iraq, Kazakhstan, and others to compensate for earlier overproduction.
These adjustments are part of broader efforts to uphold output quotas and stabilize oil markets as global demand remains in flux.
According to UBS analyst Giovanni Staunovo, the oil rally is being supported by:
- U.S. sanctions on Iran
- Fresh OPEC compliance plans
- Weaker U.S. dollar, which reduces the cost of dollar-priced commodities
Tony Sycamore, market analyst at IG, emphasized the importance of macroeconomic dynamics, noting:
“If U.S. growth stays flat and China slows to 3%-4%, demand fundamentals won’t support a major oil surge.”
Inventory and Forecast Updates
While prices firmed, U.S. crude inventories rose last week, according to data from the Energy Information Administration (EIA). Conversely, gasoline and distillate stockpiles declined, offering mixed signals on consumption trends.
In a separate development, several leading institutions—including OPEC, the International Energy Agency (IEA), Goldman Sachs, and JP Morgan—lowered their oil price and demand forecasts this week. The downgrades cite growing economic uncertainty stemming from U.S. tariffs and retaliatory trade measures globally.
Conclusion:
The combination of U.S. sanctions on Iran, reinforced OPEC output discipline, and geopolitical risks has reignited upward momentum in oil markets. Yet, with global growth signals softening and inventories mixed, analysts urge caution as volatility is likely to persist in the coming weeks.