Oil prices settled sharply higher as geopolitical risks resurfaced, driven by U.S. enforcement actions against Venezuelan oil shipments and fresh disruptions linked to the Russia-Ukraine war. Brent crude climbed $1.60, or 2.7%, to $62.07 a barrel, while WTI advanced $1.49, or 2.6%, to $58.01.
Support came after the U.S. Coast Guard attempted to intercept a sanctioned oil tanker in international waters near Venezuela, marking the third such enforcement action this month. The incident followed Washington’s announcement of a blockade targeting sanctioned vessels entering and leaving Venezuela, prompting markets to reassess the risk of export disruptions from the country. Venezuelan crude represents roughly 1% of global supply, with most volumes flowing to China, adding a layer of geopolitical sensitivity to the situation.
Oil prices also drew strength from escalating tensions around the Black Sea, a critical corridor for Russian energy exports. Ukrainian drone strikes reportedly damaged multiple vessels and port infrastructure in Russia’s Krasnodar region, underscoring ongoing risks to maritime oil and product flows tied to the conflict.
Analysts said near-term price action may consolidate as holiday-thinned trading volumes collide with weakening underlying fundamentals, though geopolitical uncertainty surrounding Ukraine, Russia, and Venezuela continues to support a modest risk premium.
Diplomatic efforts to end the war remain ongoing, with U.S., European, Ukrainian, and Russian officials holding talks aimed at aligning positions, though markets remain cautious about the likelihood and timing of any breakthrough.