- Tanker restrictions linked to Venezuela raised supply risk concerns
- Geopolitical tension outweighed weak demand signals
- Falling inventories added short-term price support.
Oil prices moved higher mid-week as fresh geopolitical action increased uncertainty around seaborne crude flows. A decision to block sanctioned oil tankers linked to Venezuela has raised concerns over potential disruptions to maritime oil movements, especially at a time when global demand remains fragile.
Venezuela Tanker Flows in Focus
While Venezuelan crude accounts for only about 1% of global oil output, its exports are concentrated among a limited number of buyers, making shipping routes particularly sensitive to disruption. Any tightening of tanker movements could reduce available supply faster than headline production figures suggest, adding volatility to tanker markets and freight sentiment.
Mixed Signals from Global Supply
The price rebound comes after oil recently traded near five-year lows, driven by expectations that eased tensions elsewhere could release additional supply into the market. However, uncertainty over enforcement actions at sea and potential vessel interdictions has shifted attention back to maritime chokepoints and political risk.
Inventory Draw Supports Near-Term Prices
Further supporting prices, U.S. crude inventories reportedly fell by over 9 million barrels last week, far exceeding market expectations. If confirmed, this sharp draw would indicate tighter short-term balances, reinforcing the impact of shipping-related risks on near-term oil pricing.
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Source: Reuters
