Oil extends gains after U.S. seizure of tanker off Venezuela
Oil prices climbed for a second consecutive day after the United States seized a sanctioned tanker near Venezuela’s coast, fueling tensions between the two nations and stoking concerns about further disruptions to supply.
Brent crude futures edged up 0.4%, rising 27 cents to $62.48 a barrel by 0101 GMT, while U.S. West Texas Intermediate (WTI) crude gained 33 cents, or 0.6%, to $58.79 a barrel.
Analysts noted that the seizure, coupled with reports of Ukrainian forces striking a vessel tied to Russia’s shadow fleet, contributed to the market’s upmove. IG market analyst Tony Sycamore remarked that the latest developments are likely to keep crude prices above the key $55 support level into year-end, unless an unexpected peace breakthrough in Ukraine materializes.
President Donald Trump commented on the action, saying, "we've just seized a tanker on the coast of Venezuela, large tanker, very large, largest one ever, actually, and other things are happening." Officially, U.S. authorities did not disclose the vessel’s name. The British maritime risk group Vanguard identified the tanker Skipper as the vessel in question.
Market participants noted that Asian buyers are seeking substantial discounts on Venezuelan crude, pressured by increases in sanctioned oil from Russia and Iran and heightened loading risks in Venezuela as the U.S. broadens its military footprint in the Caribbean.
Separately, Ukrainian sea drones disrupted another vessel involved in trading Russian oil as it navigated the Black Sea, within Ukraine’s exclusive economic zone.
Investors are closely watching developments in Ukraine peace talks. In a show of diplomatic engagement, leaders from Britain, France and Germany spoke with Trump about Washington’s ongoing peace efforts, describing the moment as a "critical moment" in the process.
On the domestic policy front, the Federal Reserve delivered a sharply divided decision on interest rates. A potential rate cut could lower borrowing costs for consumers, potentially boosting demand for oil and broader economic growth.
Reporting by Ashitha Shivaprasad in Bengaluru; Editing by Tom Hogue
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