Canadians are likely to continue paying high prices at the gas pumps as oil prices rose to their highest levels since late-2014 on Monday, boosted by concerns over Venezuela’s economic crisis and a looming decision on whether the United States will impose sanctions on Iran.
Brent crude oil futures reached US$75.63 per barrel Monday, up 76 cents from their last close. Earlier in the session, they touched their highest since November 2014 at US$75.89 a barrel.
U.S. West Texas Intermediate (WTI) crude futures rose 80 cents to US$70.52 per barrel. Monday was the first time since November 2014 that WTI had climbed above US$70 per barrel.
China’s Shanghai crude oil futures, launched in March, broke their dollar-converted record-high, rising as far as US$72.54 on Monday. The increases came despite nine U.S. oil rigs bringing the total count to 834, energy services firm Baker Hughes said in a news release.
U.S. oil firm ConocoPhillips has moved to take key Caribbean assets of Venezuela’s state-run PDVSA to enforce a US$2 billion arbitration award, actions that could further impair PDVSA’s declining oil production and exports.
Venezuela’s output has halved since the early 2000s to 1.5 million barrels per day, as the South American country has failed to invest enough in its oil industry. Expectations are high that U.S. President Donald Trump will withdraw from the Iranian nuclear pact, and that has added a further level of uncertainty. Iran re-emerged as a major oil exporter in 2016 after international sanctions against it were lifted, and President Trump has a May 12 deadline to determine whether to extend sanction waivers.
On Monday, Saudi Arabian Energy Minister Khalid al-Falih said he is concerned about low oil industry investment and potential shortages in the future.
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