Oil prices edged higher on Thursday after U.S. President Donald Trump reversed a key license allowing Chevron to operate in Venezuela, a move that could tighten global crude supply.
Brent crude futures rose $0.19 (0.3%) to $72.72 per barrel by 0154 GMT, while U.S. West Texas Intermediate (WTI) crude gained $0.16 (0.2%) to $68.78 per barrel.
On Wednesday, both benchmarks settled at their lowest levels since December 10, pressured by an unexpected rise in U.S. fuel inventories, signaling weaker demand, and optimism over potential peace talks between Russia and Ukraine.
- Trump’s Chevron Decision
Trump announced on Wednesday that he was revoking a license granted by his predecessor, Joe Biden, that allowed Chevron to operate in Venezuela. The decision halts the company’s ability to export 240,000 barrels per day (over 25% of Venezuela’s total oil output), potentially disrupting supply.
“The Venezuela news triggered some unwinding of recent sell-offs, especially amid ongoing Russian-Ukraine ceasefire discussions,” said Hiroyuki Kikukawa, president of NS Trading, a unit of Nissan Securities.
- Market Sentiment and Strategic Reserves
Potential U.S. Strategic Petroleum Reserve (SPR) purchases also provided support, with Trump previously pledging to refill reserves quickly.
Trump criticized Biden’s earlier decision to tap into the SPR to lower gasoline prices.
Investors remain focused on Trump’s Russian-Ukrainian peace talks. The U.S. president said Ukrainian leader Volodymyr Zelenskiy would visit Washington on Friday to sign a rare earth minerals agreement, though Zelenskiy emphasized that its success hinges on ongoing U.S. aid.
- U.S. Inventory Data & Market Outlook
U.S. crude stockpiles unexpectedly fell last week, but gasoline and distillate inventories rose, reflecting seasonal shifts in demand.
Kikukawa noted that the sell-off linked to rising fuel inventories “has likely run its course”, as demand transitions from kerosene to gasoline.
Goldman Sachs reaffirmed its Brent crude baseline range of $70-85, citing the U.S. administration’s push for commodity dominance and affordability as key market drivers.
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