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A new round of sanctions targeting Iran’s oil industry and the country’s oil minister boosted oil prices earlier today, offsetting the negative effect of the International Energy Agency’s latest monthly report, released Thursday.
At the time of writing, Brent crude was trading at $70.33 per barrel and West Texas Intermediate was changing hands for $67.02 per barrel, slightly up on both Thursday and the beginning of the weekly session.
The IEA said in the March edition of its Oil Market Report that global oil supply was 600,000 bpd higher than demand so far this year, thanks to stronger U.S. production and weaker demand. The report followed OPEC’s latest update, which revealed an increase in the group’s total production despite the commitment to caps aimed at supporting global prices.
“The United States is currently producing at record highs and is forecast to be the largest source of supply growth in 2025,” the IEA said, adding that “The latest round of sanctions on Russia and Iran has yet to significantly disrupt loadings, even as some buyers have scaled back purchases.”
The agency also revised down its demand growth forecast for 2025 by 70,000 bpd to 1.03 million barrels daily, which further pressured prices before the news of the fresh Iran sanctions broke.
The U.S. Treasury announced the sanctions on Thursday, with Treasury Secretary Scott Bessent saying that “The Iranian regime continues to use the proceeds from the nation’s vast oil resources to advance its narrow, alarming self-interests at the expense of the Iranian people. Treasury will fight and disrupt any attempts by the regime to fund its destabilizing activities and further its dangerous agenda.”
As a result, prices rebounded earlier today in anticipation of supply disruptions in the OPEC member, which has been exempted from the production cuts due to the U.S. sanctions.
source: oilprice.com
