Oil prices rose on Monday after officials said the U.S. had intercepted an oil tanker in international waters off the coast of Venezuela, raising fresh supply uncertainty.
Brent crude futures rose 46 cents, or 0.8%, to $60.93 per barrel by 0400 GMT, while U.S. West Texas Intermediate crude climbed 46 cents, or 0.8%, to $56.98.
“The market is waking up to the fact that the Trump administration is taking a hardline approach to the Venezuelan oil trade,” said June Goh, senior oil market analyst at Sparta Commodities.
“Oil prices have thus been supported by this geopolitical news alongside the simmering Russian-Ukraine tensions in the background in an otherwise very bearish market fundamentally,” said Goh.
The U.S. Coast Guard is pursuing an oil tanker in international waters near Venezuela, in what would be the second such operation over the weekend and the third in less than two weeks if successful, officials told Reuters on Sunday. The White House did not immediately respond to a request for comment.
A rebound in oil prices has been sparked by geopolitical developments starting with U.S. President Donald Trump’s announcement of a “total and complete” blockade on sanctioned Venezuelan oil tankers and subsequent developments there, followed by reports of a Ukrainian drone strike on a Russian shadow fleet vessel in the Mediterranean Sea, IG analyst Tony Sycamore said.
“The market is losing hope that the U.S.-brokered Russia-Ukraine peace talks will reach a lasting agreement any time soon,” he said.
“These developments are helping to offset ongoing oversupply concerns, and combined with the false break lower last week which has caught the market on the wrong foot, the balance of risks is very close to shifting back toward the upside in crude oil.”
Brent and WTI fell about 1% last week after dropping about 4% in the week of December 8.
U.S. special envoy Steve Witkoff said on Sunday talks between U.S., European and Ukrainian officials over the past three days in Florida aimed at ending Russia’s war in Ukraine had focused on aligning positions. Those meetings and separate talks with Russian negotiators had been productive, he said.
However, the top foreign policy aide of Russian President Vladimir Putin said on Sunday that changes made by the Europeans and Ukraine to U.S. proposals had not improved prospects for peace.
(Reporting by Jeslyn Lerh in Singapore, Sam Li and Lewis Jackson in Beijing; Editing by Sonali Paul and Neil Fullick)