Oil prices rise after US sanctions on Iran amid fears of reduced supplies

Oil prices continued to rise for a second day in a row on Tuesday, after the United States imposed new sanctions on Iran, raising fears of a reduction in oil supplies in global markets.

Brent crude futures were up 38 cents, or 0.51%, at $75.16 a barrel, and US West Texas Intermediate crude was up 43 cents, or 0.61%, at $71.13 a barrel.

This rise comes after gains achieved by the two crude oil in the previous session, as they compensated for losses of two dollars on Friday.

The United States on Monday imposed new sanctions targeting more than 30 brokers, tanker operators and shipping companies for their role in selling Iranian oil products.

The move aims to reduce Iran’s oil exports to zero, according to US President Donald Trump.

Iran is OPEC’s third-largest producer, pumping about 3.2 million barrels per day in January.

Although the sanctions boosted prices, the unclear outlook for global oil demand limited gains.

Analysts believe that continued trade tensions could negatively impact global demand growth, especially in light of Trump’s insistence on imposing tariffs on imports from Canada and Mexico, scheduled to take effect on March 4.

In Europe, Ukraine hosted European leaders to mark the third anniversary of the Russian invasion, but the event was notable for the absence of US officials, in a sign interpreted as a possible rapprochement between the Trump administration and Moscow.

Observers believe that any improvement in relations between Washington and Moscow could lead to an easing of sanctions on the Russian energy sector, which could increase global oil supplies and affect prices in the future.

With US sanctions on Iran still in place and trade tensions between Washington and its partners, the oil market remains volatile.

While lower supplies are supporting higher prices, any global economic slowdown could put pressure on markets going forward.