US plans to further tighten sanctions on Iranian oil exports in May increased oil prices on 22 April by almost 3%.
US Secretary of State Mike Pompeo announced on 22 April that the State Department would stop allowing some countries to import Iranian crude oil or condensate, a move that sent oil prices to 2019 highs.
Brent crude, the global benchmark, rose as much as 3.3% a barrel and was last up $1.98 to $73.95, Reuters reported. US West Texas Intermediate crude climbed by as much as 2.9% to $65.87, the highest since 31 October. WTI was up $1.48 to $65.48 a barrel.
Another drop in Iranian exports would further squeeze global oil supply. The crisis in Venezuela and oil supply cuts agreed by the Organization of Petroleum Exporting Countries (OPEC) and non-OPEC countries led by Russia have already tightened the oil market.
The increased pressure on Iran comes nearly one year after the US administration of Donald J. Trump withdrew from the Iran Nuclear Deal. The US had granted waivers to several countries in November when he first restored energy sanctions on Iran. The waivers have allowed Iran to continue exporting about 1 million barrels per day, down from roughly 2.5 million barrels per day last year.
OPEC and its allies are scheduled to meet at the end of June to decide whether to lift the production caps or maintain the oil production cuts.