and Florence Tan
SINGAPORE (Reuters) – Oil prices sank to near two-week highs on Monday after gaining 6% last week, as political tensions escalated between western powers and major oil producers Russia and Iran, raising risks of supply disruptions.
Brent crude futures were up 13 cents, or 0.2%, at $75.5 a barrel by 0115 GMT, while US West Texas Intermediate crude futures were at $75 a barrel, up 14 cents, or 0.2%.
Both contracts last week marked their weekly gains since late September to their highest levels since Nov. 7 after Russia launched a hypersonic missile to Ukraine as a warning to the United States and the UK after Kyiv attacked Russia using US and British weapons. .
“The recent exchange shows that the war has entered a new and dangerous phase, resulting in material disruptions,” ANZ analysts led by Daniel Hynes said in a note.
In addition, Iran implemented a resolution by the UN nuclear watchdog on Thursday by ordering steps such as installing new and advanced centrifuges used in uranium enrichment.
“The IAEA’s criticism and Iran’s response increase the likelihood that Trump will consider imposing sanctions on Iran’s oil exports once he takes office,” Vivek Dhar, a commodity strategist at the Commonwealth Bank of Australia, said in a note.
The imposed sanctions could freeze a million barrels a day of Iran’s oil sales, about 1% of the world’s oil, he said.
Iran’s foreign ministry said on Sunday it will hold talks on its disputed nuclear program with three European powers on November 29.
Investors also focused on increasing crude oil demand in China and India, the world’s top and third-largest importers, respectively.
Exports to China rose again in November as lower prices boosted demand for the currency while Indian refiners’ exports rose 3 percent year-on-year to $5.4 million in October, driven by oil exports.
(Reporting by Florence Tan; Editing by Sonali Paul)