Renewed U.S sanctions against Iran to begin today: oil prices rise further.

Oil prices climbed further on Tuesday, August 7^th 2018 ahead of renewed US sanctions against Iran, that are to be implemented starting today. Iran had been shipping out around 3 million barrel per day (bpd) of crude during the past month.

Spot Brent crude oil futures were at $73.88 per barrel at 0241 GMT on Tuesday, up 13 cents, or 0.2 percent, from their last close.

U.S West Texas Intermediate (WTI) crude futures were up 1 cent at $69.02 barrel.

U.S is adamant on getting as many countries to stop buying Iranian oil, as possible. A senior U.S administration official said on Monday, “It is our policy to get as many countries to zero as quickly as possible. We are going to work with individual countries on a case-by-case basis, but our goal is to reduce the amount of revenue and hard currency going into Iran.”

While on one hand U.S is determined to reduce Iran’s revenue, many countries including China, India and U.S allies in Europe oppose the new sanctions.

French ban Societe Generale warned that although there is a comfortable supply in the physical crude market, Iran sanctions will limit their capacity to deal with unforeseen supply disruptions.

Furthermore, analysts cautioned that a global heat wave could also bring about an increase in oil demand. Evidently, the northern hemisphere experienced very hot summers this time round which pushed up demand for industrial and residential cooling and by extension, demand for power fuels.