Brent crude futures rose 21 cents to $71.39 a barrel by 1:05 p.m. EDT (1705 GMT). U.S. West Texas Intermediate (WTI) crude futures rose 28 cents to $63.68 a barrel.
“We are still viewing the price consolidation of the past week as a pause in a sustainable bull market in which fresh highs still represent a strong possibility,” Jim Ritterbusch, president of Ritterbusch and Associates, said in a note.
In Libya, fighting between Khalifa Haftar’s Libyan National Army and the internationally recognized government has raised the prospect of lower supplies from the OPEC member.
U.S. sanctions on two other members, Iran and Venezuela, are already cutting shipments. Iran’s crude oil exports have dropped in April to their lowest daily level this year, tanker data showed and industry sources said.
“Collapsing Venezuelan oil output and sanctioned Iranian exports have a put big question mark over supply,” said Norbert Ruecker of Swiss bank Julius Baer.
“With the many supply threats, the market mood turns more bullish by the day and this should support prices over the coming weeks.”
Adding downward pressure were concerns about Russia’s willingness to stick with OPEC-led supply cuts and expectations of higher U.S. inventories.
Oil prices have gained this year more than 30 percent, helped by the deal between the Organization of the Petroleum Exporting Countries and other producers including Russia. The group has been cutting output since Jan. 1 and will decide in June whether to continue the arrangement.
Gazprom Neft, the oil arm of Russian gas giant Gazprom, expects the global oil deal between OPEC and its allies to end in the first half of the year, a company official said on Tuesday.
Russia and the producer group may decide to boost output to fight for market share with the United States, TASS news agency сited Finance Minister Anton Siluanov as saying on Saturday.
“There is a growing concern that Russia will not agree on extending production cuts and we could see them officially abandon it in the coming months,” said Edward Moya, senior market analyst at OANDA.
Also weighing on prices, U.S. crude inventories are expected to have risen by 1.9 million barrels last week, the fourth straight weekly increase. The first of this week’s stockpile reports is due at 4:30 p.m. EDT (2030 GMT) from the American Petroleum Institute. (Reuters)