Oil prices fell yesterday as record US output and rising crude stockpiles dampened the impact on markets of tighter US sanctions on Iran and producer club OPEC’s continued curbs on supply.
Brent crude futures were at $74,35 per barrel at 0037 GMT, down 22 cents, or 0,3 percent, from their last close.
US West Texas Intermediate (WTI) crude futures were at $65,60 per barrel, down 29 cents, or 0,4 percent, from their previous settlement.
Crude futures rose to 2019 highs earlier in the week after the United States said on Monday it would end all exemptions for sanctions against Iran, demanding countries halt oil imports from Tehran from May or face punitive action from Washington.
“Following the US decision to toughen its sanctions on Iran. . . we have revised up our end-year forecast for Brent crude from $50 to $60 per barrel,” analysts at Capital Economics said in a note.
The US decision try and bring down Iran oil exports to zero comes amid supply cuts led by producer Organisation of the Petroleum Exporting Countries (OPEC) since the start of the year aimed at propping up prices.
As a result, Brent crude oil prices have risen by almost 40 percent since January.
Despite this, Capital Economics said “we still expect oil prices to fall this year as sluggish global growth weighs on oil demand, US shale output grows strongly and investor aversion to risk assets like commodities increases.”