Oil is at its highest level since November 2014, despite curbing gains

US crude oil futures rose to their highest level since November 2014, supported by OPEC-led production cuts and the possibility of new US sanctions on Iran, while US stockpiles are holding back price gains. US President Donald Trump is due to decide whether to renew or exit the Iranian nuclear deal on May 12, as the European deadline for reform of the deal approaches.

Reports suggest that with the possibility of re-imposing US sanctions on Iran, the stability of its oil production of 2.6 million barrels per day in April, a record high since the lifting of sanctions will face the danger. Senior market analysts believe that current oil prices include price rises due to uncertainty about Iran. Investors are wary of supplies, after Iran took a tough line in its response to the United States.

US WTI crude futures rose to $69.97 a barrel, a 0.3% increase. Brent crude rose to $74.88 dollars per barrel, or 1.82% from the previous session, after reaching $73.80 dollars earlier in the morning.

Oil is bolstered by the prospect of a US withdrawal from the nuclear deal with Iran, raising concerns about crude supplies from the Middle East. OPEC-led production cuts are helping to reduce supply in the world. The total production of the Organization of the Petroleum Exporting Countries (OPEC) fell on the back of the problems in Venezuela and the agreement to cut world production between OPEC and Russia. OPEC and other producers signed an agreement starting in January 2017 to reduce global oil production, as an attempt to support global markets and end the supply gap.

Russian crude oil output stood at 10.97 million bpd last month, unchanged from March, where production hit an 11-month high, but above the target level under the agreement to curb production. “Russia’s commitment to the agreement reached 95.2 per cent in April,”Russian Energy Minister Alexander Novak said. He added that “Russia is fully committed to achieving balance in the region,”

Russia has agreed to reduce its oil production by 300,000 barrels per day from 11.247 million bpd in October 2016, the base month of cuts in the deal signed with OPEC and other producers.