Oil prices up as Iran pressure overcomes supply surge

Crude prices were higher on Friday as looming Iran sanctions kept up pressure despite an increase in stockpile data sparking concerns about a global oversupply.

West Texas Crude oil futures for November rose 0.66% to $71.44 a barrel as of 6:07 AM ET (10:07 GMT). Meanwhile Brent crude futures, the benchmark for oil prices outside the U.S., increased 0.44% to $80.61.

Data on Thursday showed that inventories in the US continue to rise more than expected, leading to a concern of oversupply. US crude inventories rose by 6 million barrels last week, compared with the general consensus of a 2.6 million-barrel increase, the EIA reported on Thursday.

A week earlier the agency reported an 8-million barrel rise in US crude stocks.

Meanwhile the <a href=’https://staging.theenergyyear.com/companies-institutions/opec/’>OPEC cut its oil demand growth estimates for 2018 and 2019 in its monthly report on Thursday.

The organisation revised its global oil demand growth to 1.54 million barrels per day this year, down by 80,000 bpd. Potential headwinds to global economic growth were cited as the reason for the downgrade.

Prices of oil have already been rising in recent months over concern of tightening supply due to U.S. sanctions against Tehran, which are due to take effect November 4 but have already caused Iran’s crude exports to fall.

Iran is the world’s fourth-largest oil producer and the third-largest exporter in the OPEC.

Traders are also looking ahead to the weekly US Baker Hughes oil rig count, which is a leading indicator of demand for oil products.

In other energy trading, Gasoline RBOB Futures rose 1.00% to $1.9518 a gallon, while heating oil increased 0.23% to $2.3376 a gallon. Natural gas futures surged 1.30% to $3.264 per million British thermal units.