Crude Oil Prices Settle Higher as Bets on New Iran Sanctions Heat Up

Investing.com – Crude oil prices settled higher as the prospect of new U.S. sanctions against Iran heated up after Israeli Prime Minister Benjamin Netanyahu revealed files he claimed show Iran continued to develop nuclear weapons.

On the New York Mercantile Exchange for June delivery rose 0.69% to settle at $68.57 a barrel, after hitting an intraday high of $69.33 a barrel. While on London’s Intercontinental Exchange, rose 1.06% to trade at $74.55 a barrel.

Netanyahu on Monday, citing documents obtained from a “highly secret location” in Iran, claimed Tehran ran a secret program to build nuclear weapons, violating the terms of the Iran nuclear deal that had lifted sanctions on the country in 2015.

The International Atomic Energy Agency and the signatories to the Iran nuclear accord, however, have repeatedly confirmed that Iran was complying with the deal, Reuters said, which includes limits on its nuclear program and allowing international investigators access to its facilities.

This comes less than two weeks before U.S. President Donald Trump must decide on May 12 whether to restore U.S. sanctions on Iran.

If Trump does scrap the deal, it could lead to the re-imposition of secondary sanctions on Iran, pressuring countries to cut their purchases of Iranian crude, denting global supplies, pushing oil prices higher.

RBC said Friday that the Iran deal “remains on life support,” as the Iranians were “very unlikely,” to satisfy the demands of US President Trump and his “ultra-hawkish” advisors.

“We so not see the deal surviving past summer given the constellation of domestic and foreign forces aligned against it,” RBC said.

The prospect of renewed sanctions against Iran offset signs of a continued uptick in U.S. output after data from energy services firm Baker Hughes showed the number of oil rigs operating in the US .

U.S. production rose to 10.59 million barrels per day, the EIA said last week, maintaining the United States’ position as the world’s second largest producer behind Russia.

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