Oil Prices Rise for Second Week as U.S. Sanctions and OPEC+ Cuts Tighten Supply
📌 Key Highlights:
✔ Oil prices climb for a second straight week, driven by supply concerns and new U.S. sanctions on Iranian crude.
✔ Brent crude up 0.2% at $72.12, while WTI rises 0.2% to $68.22, marking the strongest weekly gains since early 2025.
✔ OPEC+ pledges to cut overproduction, raising expectations of tighter supply through 2026.
✔ Analysts forecast a potential 1 million bpd drop in Iranian crude exports as sanctions tighten.
📊 Oil Market Overview: Supply Disruptions Fuel Price Rally
Crude oil prices extended gains on Friday, heading for their second consecutive weekly increase, as tightening supply conditions sparked bullish sentiment. The latest U.S. sanctions on Iranian crude exports and the OPEC+ decision to enforce output cuts fueled market optimism, pushing both Brent and WTI futures over 1% higher this week.
At 08:50 GMT, Brent crude was trading at $72.12 per barrel (+0.2%), while WTI crude rose to $68.22 per barrel (+0.2%). These gains mark the biggest weekly increase since early January.
🇺🇸 U.S. Sanctions on Iran: Crude Supply at Risk
The U.S. Treasury announced fresh Iran-related sanctions on Thursday, taking aim at entities and vessels involved in Iranian crude oil shipments. Notably, a Chinese independent refiner was targeted for the first time, a move seen as part of Washington’s renewed “maximum pressure” strategy on Tehran.
🔹 Analyst View: ANZ Bank estimates that Iranian crude exports could drop by 1 million bpd due to the tighter sanctions.
🔹 Current Exports: Vessel tracking data from Kpler suggests Iran exported over 1.8 million bpd in February—a figure that could significantly decline under the new restrictions.
The U.S. crackdown is the fourth round of sanctions against Iran since February 2025, when the Biden administration vowed to intensify efforts to curb Tehran’s oil exports.
🛢️ OPEC+ Output Plan: Supply Adjustments Until 2026
Oil prices also found support from the latest OPEC+ strategy to balance the market. The producer alliance confirmed plans for select members to cut output further, aiming to compensate for previous overproduction.
📌 Key Takeaways from OPEC+ Plan:
✔ Seven OPEC+ members to implement additional production cuts, ranging from 189,000 bpd to 435,000 bpd per month until June 2026.
✔ Despite these adjustments, OPEC+ will move forward with a scheduled output increase of 138,000 bpd from April, easing some of the 5.85 million bpd cuts imposed since 2022.
✔ Market analysts warn that not all OPEC+ members comply with quotas, with some consistently exceeding production targets.
🔎 Expert Insight: “While OPEC+ is trying to enforce compensation cuts, history suggests that adherence could be inconsistent,” ING analysts cautioned in a Friday note.
📉 Will Oil Prices Keep Rising? Key Market Drivers to Watch
✔ Tighter Iranian Oil Supply – If U.S. sanctions are effective, crude exports from Iran could fall significantly.
✔ OPEC+ Compliance Risks – The group’s ability to enforce production discipline will impact supply balance.
✔ Macroeconomic Trends – Interest rate decisions and economic growth outlooks could influence global oil demand.
💡 Market Outlook: Oil traders will closely monitor supply adjustments and geopolitical developments in the coming weeks. If OPEC+ successfully enforces output cuts and U.S. sanctions reduce Iranian exports, Brent crude could test the $75 resistance zone in the near term.
📢 Do you think oil prices will continue to rise, or is a pullback ahead? Share your thoughts in the comments! 👇💬
