West Texas Intermediate (WTI) crude oil maintained its ground for the third consecutive session, trading around $68.40 per barrel during Asian hours on Friday. Oil prices remain poised for a second straight weekly gain, largely driven by fresh U.S. sanctions on Iran.
US Sanctions and Supply Impact
On Thursday, the U.S. Treasury imposed new Iran-related sanctions, targeting a Chinese refiner and other entities involved in shipping Iranian crude to China. Analysts at ANZ Bank, cited by Reuters, expect these sanctions to cut Iran’s crude exports by up to 1 million barrels per day (bpd). However, vessel tracking service Kpler estimated that Iran’s crude exports surpassed 1.8 million bpd in February, though sanctions could obscure actual figures.
OPEC+ Production Adjustments
Oil prices also draw support from OPEC+ production cuts. The group has outlined a plan for seven member nations to gradually reduce output by 189,000–435,000 bpd monthly until June 2026. Key contributors to these reductions include Kazakhstan, Iraq, and Russia.
However, OPEC+ has also announced that eight of its members will increase output by 138,000 bpd per month starting in April, reversing some of the 5.85 million bpd in cuts implemented since 2022 to stabilize the market.
Geopolitical Tensions Add Risk Premium
Rising geopolitical risks continue to influence oil markets. Israel has launched a new ground offensive in Gaza, while U.S. airstrikes persist against Iran-backed Houthi rebels in Yemen. Meanwhile, Russia’s Foreign Ministry accused Ukraine of violating a ceasefire on energy infrastructure by attacking a Russian oil depot.
With supply constraints and geopolitical uncertainties in focus, oil prices remain well-supported in the near term.
