Brent holds firm as Venezuela tensions persist
The front-month ICE Brent contract has dipped by $0.10/bbl on the day, to trade at $60.10/bbl at 09.00 GMT.
IMAGE: Getty Images
Upward pressure:
Brent's price has gained some upward momentum after the US Energy Information Administration (EIA) reported a big draw in US crude inventories.
US crude stocks fell by 3.8 million barrels in the week ending 2 January, according to the EIA weekly oil inventory report.
A drawdown in crude inventories is typically interpreted as a sign of healthy demand, lending support to Brent futures.
Downward pressure:
Reports that the US is tightening its grip on Venezuela’s oil exports have reinforced expectations of increased supply. The US seized two oil tankers linked to Venezuela in the Atlantic Ocean on Wednesday, including one sailing under the Russian flag, as part of President Donald Trump’s forceful effort to control oil movements across the Americas and pressure Venezuela’s socialist government into alignment, Reuters reported.
The development has continued to weigh on Brent futures.
“Developments around Venezuela continue to grab headlines, putting further pressure on oil prices,” two analysts from ING Bank said.
“The control that the US intends to exert over the Venezuelan oil industry also raises questions over the future of Venezuela’s membership within OPEC,” they added.
By Tuhin Roy
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