Oil prices traded higher during Thursday's Asian deals as markets weighed reports of fresh United States sanctions on Russia’s energy sector alongside supply risks from Trump's Venezuelan tanker blockade.
By 3:30 pm AEDT (4:30 am GMT), Brent crude climbed 34 cents or 0.7% to $60.02 per barrel, while U.S. West Texas Intermediate crude was up 40 cents, or 0.7%, at $56.34 per barrel.
Earlier in the session, Bloomberg reported that the U.S. was preparing another round of sanctions targeting Russia’s energy sector should Moscow reject a proposed peace agreement with Ukraine, citing people familiar with the matter.
ANZ analysts said escalating concerns were building around the negotiations. “Despite signs that Ukraine is close to agreeing a proposed peace plan, there are mounting concerns that Russia will reject its terms.
"So much so that the U.S. is preparing a fresh round of sanctions on Russia’s energy sector if that occurs.
"Such measures may include targeting vessels that Russia uses to transport its oil, as well as traders who facilitate the transactions,” they said.
The Bloomberg report said Washington was considering targeting Russia’s so-called shadow fleet of vessels used to ship sanctioned oil, as well as traders involved in those flows, with new measures potentially announced as early as this week.
Russian President Vladimir Putin on Wednesday threatened to seize more Ukrainian territory by force if Europe did not engage with U.S.-backed settlement proposals, following several days of talks that have yet to yield progress.
Meanwhile, fresh data from the U.S. Energy Information Administration showed that U.S. commercial crude oil inventories, excluding those in the Strategic Petroleum Reserve, decreased by 1.3 million barrels from the previous week, compared with market expectations for a 1.1 million barrel draw.
“At 424.4 million barrels, U.S. crude oil inventories are about 4% below the five year average for this time of year.”
