New sanctions ignite the oil market.. How have they affected prices?

Crude oil prices witnessed a significant increase during trading on Thursday, as global market concerns about supply shortages intensified following the announcement by the United States of new sanctions targeting the Iranian oil sector, which pushed oil futures to achieve strong gains.

Oil futures register strong gains amid escalating concerns

West Texas Intermediate crude oil futures rose by 1.47% to reach $67.97 per barrel, while Brent crude contracts increased by 1.48% to reach $71.87 per barrel. This uptick was driven by recent developments that raised market worries about the stability of global supplies.

New U.S. sanctions on the Iranian oil sector increase pressure on markets

The U.S. Treasury Department announced new sanctions against the Chinese "Teapot" refinery and its CEO Wang Xiuhe Qing, due to their involvement in the purchase and refining of Iranian oil worth hundreds of millions of dollars. The sanctions also targeted 19 entities and a ship linked to Iran, which plays a key role in exporting oil as part of what is known as the Iranian "shadow fleet," further heightening concerns about declining oil supply in global markets.

U.S. pressure on Chevron exacerbates oil supply crisis

In addition to sanctions on Iran, reports indicated that U.S. Secretary of State Marco Rubio informed Chevron that it must halt its operations in Venezuela by April 3, which could lead to a decrease in Venezuelan exports—an important source of heavy oil in global markets—adding further pressure to supply levels.

Energy markets experience mixed movements amid supply disruptions

Other energy markets exhibited mixed movements, with heating oil futures rising by 0.90% to reach $2.2520 per gallon, while gasoline futures increased by 0.67%, registering $2.1841 per gallon. Conversely, natural gas futures fell by 4.40% to $4.060 per million British thermal units, influenced by demand fluctuations and weather forecasts.

It is noteworthy that as U.S. sanctions on Iran mount and pressures on Venezuelan supplies escalate, investors are closely monitoring geopolitical developments and their impact on oil markets. There is growing uncertainty about whether these measures will lead to further tightening in the global energy market, which could push prices higher in the coming period.

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