Oil prices have risen, supported by a larger-than expected US stock draw and supply concerns in Norway and Libya.
Tuesday’s gains were tempered, though, by the United States’ indication that it would consider requests for waivers from Iranian oil sanctions.
Brent crude futures gained 79 cents to settle at $US78.86 per barrel.
Earlier, the global benchmark hit a session high of $US79.51.
US crude futures rose 26 cents to settle at $US74.11, after hitting a high of $US74.70.
US crude inventories fell last week by 6.8 million barrels, according to data from industry group the American Petroleum Institute.
That decline was larger than expected, causing crude futures to gain in post-settlement trading.
Analysts polled by Reuters forecast that crude stocks fell on average by 4.5 million barrels, ahead of government data on Wednesday.
Crude’s rise on Tuesday was fuelled in part by ‘positive macro spillover from strong global equities,’ Jim Ritterbusch, president of Ritterbusch and Associates said in a note.
All three major stock indexes rose on Tuesday, and the S&P 500 posted its highest close since February 1.
Both crude benchmarks retreated from near four-year highs after US Secretary of State Mike Pompeo said the United States would consider requests from some countries to be exempted from sanctions on Iranian oil.
‘That basically took the wind out of the sails from the market,’ said Phil Flynn, analyst at Price Futures Group in Chicago.
‘But it isn’t unlike anything that they’ve said before. But it all depends on which countries they’re talking about. Is it big buyers of Iranian crude? Is it India? … Is it temporary waivers?’
Last month, the United States said it wanted to reduce oil exports of fifth-biggest producer Iran to zero by November.
Still, Brent was buoyed by a strike by hundreds of workers on Norwegian offshore oil and gas rigs, leading to the shutdown of one Shell-operated oilfield.
Also bullish to prices was plummeting production in Libya, where output has halved in five months to 527,000 barrels per day.
‘Working in the opposite direction of the Norwegian oil workers strike and the geopolitical situation’ was the update on the Syncrude oil sands facility, said Yawger at Mizuho.
On Monday, Suncor Energy said its 360,000-barrel-per-day Syncrude facility would resume some production in July, earlier than expected, following an outage last month that disrupted total output and sent US prices higher.
The updated timeline has muted US price gains and widened the difference between the two benchmarks, said Yawger.