Oil prices climbed Monday as markets weighed potential supply disruptions tied to Venezuela and Russia.
Brent crude futures rose $1.47, or 2.4%, to $61.94 a barrel by 1:27 p.m. ET.
U.S. West Texas Intermediate gained $1.37, also 2.4%, to $57.89.
U.S. actions near Venezuela
The U.S. Coast Guard tried to intercept an oil tanker on Sunday in international waters near Venezuela.
U.S. officials said the vessel was part of Venezuela’s illegal sanctions evasion.
Reuters reported it was the third such operation this month.
Blockade
The move followed President Donald Trump’s announcement last week of a blockade of sanctioned oil tankers entering and leaving Venezuela.
UBS analyst Giovanni Staunovo said market participants now see higher risk of disruption to Venezuelan exports after previously downplaying it.
Venezuelan crude accounts for about 1% of global supply, with most of it bought by China.
China said Monday that the U.S. seizure of another country’s ships is a serious violation of international law, after the U.S. intercepted a China-bound tanker off Venezuela on Saturday.
Ukraine strikes in Russia’s Black Sea region
Oil prices also drew support from reports of Ukrainian drone attacks on Russian ships at a Black Sea port, according to Ritterbusch and Associates.
Regional authorities in Russia’s Krasnodar region said a drone attack damaged two vessels and two piers and sparked a fire in a village on the Black Sea coast.
The Black Sea region is vital for Russia’s energy exports.
Ritterbusch and Associates said in a note:
“We expect further consolidation this week amid reduced holiday volumes and a continued standoff between deteriorating oil fundamentals and a need to maintain some geopolitical risk premium related to Ukraine/Russia and Venezuela.”
Diplomatic talks continue
U.S. special envoy Steve Witkoff said talks in Florida over the past three days with U.S., European and Ukrainian officials focused on aligning positions to end Russia’s war in Ukraine.
He said the meetings and separate talks with Russian negotiators had been productive.
A top foreign policy aide to Russian President Vladimir Putin said changes made by Europeans and Ukraine to U.S. proposals had not improved prospects for peace.
