Oil costs climb from 2-month lows as Trump axes Chevron’s Venezuela license

By Yuka Obayashi

TOKYO (Reuters) – Oil costs edged up from two-month lows on Thursday after U.S. President Donald Trump introduced a reversal of a license given to Chevron to function in Venezuela, probably tightening crude provide.

Brent crude oil futures rose 19 cents or 0.3% to $72.72 a barrel by 0154 GMT. U.S. West Texas Intermediate crude oil futures have been up 16 cents or 0.2% at $68.78 per barrel.

Each benchmarks on Wednesday settled at their lowest since December 10 resulting from a shock construct in U.S. gas inventories that hinted at weakening demand and hopes for a possible peace deal between Russia and Ukraine.

Trump on Wednesday stated he was reversing a license given to Chevron to function in Venezuela by his predecessor Joe Biden greater than two years in the past.

Chevron exports about 240,000 barrels per day of crude from its Venezuela operations, over 1 / 4 of the nation’s complete oil output. Ending the license means Chevron will not be capable of export Venezuelan crude.

“The Venezuela information triggered unwinding after the current sell-off amid Russian-Ukraine ceasefire talks,” stated Hiroyuki Kikukawa, president of NS Buying and selling, a unit of Nissan Securities.

“Potential shopping for from the U.S. Strategic Petroleum Reserve additionally supported the market since WTI was buying and selling close to its lowest stage in over two months,” he stated.

Final week, Trump stated his administration would rapidly refill the SPR. He criticized Biden for tapping the SPR to convey down the value of gasoline.

Market individuals stay centered on Trump’s Russian-Ukrainian peace talks. Trump stated Volodymyr Zelenskiy would go to Washington on Friday to signal an settlement on uncommon earth minerals, whereas the Ukrainian chief stated the success of the deal would hinge on these talks and continued U.S. help.

U.S. crude oil stockpiles fell unexpectedly final week as refining exercise ticked larger, whereas gasoline and distillate inventories posted stunning beneficial properties, the Vitality Info Administration stated on Wednesday. [EIA/S]

“Since this can be a seasonal off-peak interval, with demand shifting from kerosene to gasoline, the sell-off pushed by rising product inventories has seemingly run its course,” NS Buying and selling’s Kikukawa stated.

Individually, Goldman Sachs stated in a observe on Wednesday that the U.S. administration’s twin objectives of commodity dominance and affordability reinforce the financial institution’s Brent $70-85 vary baseline, a variety that’s conducive to strong U.S. provide development.

(Reporting by Yuka Obayashi; Modifying by Edwina Gibbs)