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Oil prices rise on drop in Saudi crude supply to US
OIL prices rose for a third day on Thursday, pushed up by lower imports into the United States amid Opec efforts to tighten the market, and as Venezuela struggles to keep up its crude exports after Washington imposed sanctions on the nation.
US West Texas Intermediate (WTI) crude futures were at US$54.47 per barrel, up 24 cents, or 0.4 per cent, from their last settlement.
International Brent crude oil futures were up 36 cents, or 0.6 per cent, at US$62.01 per barrel.
The price rise came after a report from the US Energy Information Administration (EIA) on Wednesday showed a drop in Saudi crude supply to the United States.
"Crude oil prices were stronger after signs emerged that OPEC cuts are impacting trade. EIA's weekly report showed that U.S. imports from Saudi Arabia fell by more than half from the previous week to 442,000 barrels per day (bpd). This is the second lowest level in weekly data going back to 2010," ANZ bank said.
Saudi Arabia is the de-facto leader of the Organization of the Petroleum Exporting Countries (Opec), which together with some non-Opec producers, including Russia, announced supply cuts late in 2018 aimed at tightening the market and propping up prices.
US sanctions imposed on state-oil firm Petroleos de Venezuela SA (PDVSA) this week are also causing some supply disruptions.
Venezuela's oil inventories have started to build up at the country's ports and terminals as PDVSA is finding it cannot export crude at its usual rate due to US sanctions imposed earlier this week.
Matt Stanley, a broker with Starfuels in Dubai, said the combination of U.S. sanctions against oil producers Venezuela and Iran, the OPEC-led supply cuts, as well as hopes that the trade dispute between the United States and China could soon be resolved meant oil prices would likely rise further.
"There are just too many factors that can only cause the price to go one way and that is up," Stanley said. REUTERS