DTN Oil Update
Oil Futures Rise as Trump Reverses Chevron's Venezuelan Permit
HOUSTON (DTN) -- Oil futures rose Thursday morning after U.S. President Donald Trump announced Wednesday, Feb. 26, the termination of Chevron's license to produce and export Venezuelan oil starting this week.
The NYMEX WTI and ICE Brent futures contract for April delivery rose by $0.94 to $69.56 bbl while the front-month ICE Brent rose by $0.97 at $73.50 bbl. The ULSD futures contract for March delivery increased by $0.0282 to $2.3725 gallon while March RBOB futures contract rose by $0.0145 to $1.9634 gallon.
The U.S. Dollar Index increased by 0.67% to 106.99 against a basket of foreign currencies.
U.S. President Donald Trump announced Wednesday, Feb. 26, that his administration would reverse a permit issued by the United States government under Joe Biden's administration, which allowed Chevron to produce and export Venezuelan oil.
"Trump's announcement in his Truth Social network accused the government of President Nicolas Maduro of not meeting democratic conditions for last year's July presidential election as well as of not moving fast enough to transport back to Venezuela immigrants set for deportation," AP reported.
This year, the U.S. has imposed additional sanctions on Russian and Iranian oil trades, which were expected to put upward pressure on oil prices. However, high U.S. crude inventory levels in recent weeks, coupled with weak global oil demand due to the uncertainty about the trade tariffs war, have caused the two crude benchmarks to fall to their lowest levels since December.
Expectations of ample supplies due to the possibility of an end of the Russia-Ukraine war, now in its third year, have set a bearish tone in the oil futures market in previous trading sessions creating downward pressure on oil futures prices.
Wednesday, Feb. 26, the Energy Information Administration reported commercial crude oil inventories in the U.S. fell by 2.3 million bbl to 430.2 million bbl for the week ending Feb. 21. It was a larger draw compared to the 640,000 million bbl draw reported by API Wednesday, Feb. 26 for the same reference week.
Gasoline stocks rose by 400,000 bbl week-over-week reaching 248.3 million bbl, which was below the 573,00 bbl increase reported by API for the same period, according to EIA.
