Oil price rise in the wake of rising Middle East tensions, added by a healthy global demand, despite the looming threat of increasing US Shale output.
U.S. West Texas Intermediate (WTI) crude futures were at $63.82 a barrel at 0027 GMT, up 28 cents, or 0.4 percent, from their previous close.
Brent crude futures were at $67.66 per barrel, up 24 cents, or 0.4 percent.
Saudi Arabia’s Crown Prince Mohammed bin Salman (MBS) arrived on a state visit to Washington today, prompting fears of a strict sanctions on Iran. The recent wake of US backlash has come against Iran in the backdrop of Trump’s displeasure over Obama era nuclear deal with Iran.
The presence of MBS in the US has triggered a range of fears among investors and analysts alike regarding Iran, which have been translating into rising global oil prices. Experts are of the opinion that the US would soon impose sanctions on Iran in the coming few weeks hampering the oil supply from Iran down by 250,000 to 500,000 barrels per day.
Analysts also pointed to healthy economic growth and a weak dollar as oil price drivers.
On the demand front, U.S. crude stocks fell by 2.7 million barrels in the week ended March 16 to 425.3 million, as refineries boosted output, the American Petroleum Institute said on Tuesday.
Some analysts warn that the US Shale output has not peaked as of yet. They say U.S. producers are holding back expansion in order to prevent another price crash, as seen between 2014 and 2016.
