The price of Brent crude oil opened above $70 per barrel at trading start on Monday, sustaining its five-month highs as global oil supply tightens with OPEC+ cuts, and with sanctions on Iran and Venezuela.
The international benchmark traded at $70.61 a barrel at 0540 GMT with a 0.4% gain after it closed Friday at $70.34 per barrel, according to official figures. On Thursday, Brent oil climbed above $70 per barrel — its highest level since Nov. 12.
American benchmark West Texas Intermediate (WTI) registered at $63.35 per barrel at the same time, posting a 0.4% increase, after ending Friday at $63.08 a barrel.
Crude prices have been on the rise since the beginning of 2019 as overall oil supply is tightening around the world. While Brent oil gained 31% since the start of 2019, WTI rose 39% from year-to-date, according to official figures.
Due to U.S.’ sanctions on Iran and Venezuela, both countries’ oil production levels are in decline, and are expected to account for a total of 1.76 million barrels per day (bpd) in lost output this year.
In addition, the supply cut deal of Saudi Arabia-led OPEC and Russia led non-OPEC continues to put an upward pressure on crude prices.
Dubbed as OPEC+, the cartel and its allies agreed on Dec. 7, 2018 to lower total production by 1.2 million bpd for the first six months of 2019.