Brent sweet crude climbed to fresh highs on Monday, buoyed as a deepening economic crisis in Venezuela threatened the country’s already tumbling oil supply.
United States oil prices rose above 70 dollars a barrel for the first time since November 2014.
The concerns added to worries over a looming decision on whether the United States will walk away from a deal with Iran.
Instead, it will re-impose sanctions on Tehran, keeping international oil markets on edge.
Meanwhile, China’s Shanghai crude oil futures, launched in March, broke their dollar-converted record high of 71.32 dollars per barrel by rising as far as 72.54 dollars on Monday.
Analysts warned that the deepening economic crisis in major oil exporter, Venezuela, threatened to further crimp its production and exports.
Venezuela’s oil output has halved since the early 2000s to just 1.5 million barrels per day (bpd), as the South American country has failed to invest enough to maintain its petroleum industry.
Beyond Venezuela’s woes, Greg McKenna, Chief Market Strategist, at futures brokerage AxiTrader, said “the big story this week is going to be about oil and the Iran Nuclear deal’’.
Most market participants expect Trump to withdraw from the pact, he said.
Iran re-emerged as a major oil exporter in 2016 after international sanctions against it were lifted in return for curbs on Iran’s nuclear programme.
Expressing doubts over Iran’s sincerity, Mr Trump has threatened to walk away from the 2015 agreement by not extending sanctions waivers when they expire on May 12.
This situation would likely result in a reduction of Iran’s oil exports.