Petroleum prices climbed on Wednesday as concerns about tighter global supply grew following the U.S. threat of tariffs on nations buying Venezuelan crude, along with a larger-than-expected drop in U.S. crude inventories.
Brent crude futures gained 49 cents, or 0.67%, to $73.51 U.S. a barrel, while U.S. West Texas Intermediate crude futures, for their part, rose 48 cents, or 0.70%, to $69.48 a barrel.
Both contracts hit their highest in three weeks in the previous session.
Trade in Venezuelan oil to top buyer China stalled on Tuesday after U.S. President Donald Trump’s order threatening tariffs on countries buying from Caracas created fresh uncertainty, days after U.S. sanctions targeting China’s imports from Iran.
On Monday Trump signed an executive order authorizing his administration to impose blanket 25% tariffs under the 1977 International Emergency Economic Powers Act on imports from any country that buys Venezuelan crude oil and liquid fuels.
Oil is Venezuela’s main export and China is already a target of U.S. import tariffs.
Chinese traders and refiners said they were waiting to see how the order would be implemented and whether Beijing would direct them to stop buying.
The market was also propped up by American Petroleum Institute data that showed U.S. crude inventories fell by 4.6 million barrels last week, a sign of healthy demand for fuel in the world’s largest economy.
Analysts polled by Reuters were expecting a decline of one million barrels.
