Oil Hovers at Four-Year High as Global Supply Concerns Mount

(Bloomberg) — Oil traded near the highest level in almost four years as a drop in exports from Iran adds to concerns over a global supply crunch.

Crude in New York rose as much as 0.4 percent after closing Monday at the highest since November 2014. Oil exports from Iran fell to their lowest in 2 1/2 years ahead of U.S. sanctions, while the number of rigs drilling for American crude dropped a second week, signaling a potential slowdown in output growth.

Oil has rallied to levels last seen in 2014 as supply disruptions from Iran to Venezuela continued to fracture the global market. Top traders have forecast crude may top $100 a barrel amid speculation that backup supplies are scarce. Even so, BP (LON:) Plc cautioned that the rally may not be sustainable as escalating trade tensions between the U.S. and China imperil demand.

“Right now, we’re just in a bull market for oil because of the prospects of a very tight market later on in the year,” said John Kilduff, founding partner at New York-based hedge fund Again Capital LLC.

West Texas Intermediate for November delivery rose as much as 29 cents to $75.59 a barrel on the New York Mercantile Exchange, and traded at $75.44 at 9:10 a.m. in Tokyo. The contract surged 2.8 percent to $75.30 on Monday.

for December settlement slid 0.1 percent to $84.89 a barrel on the London-based ICE Futures Europe exchange. The global benchmark rose $2.25 to $84.98 a barrel on Monday.

In the U.S., onshore rigs targeting oil fell by three last week to 863, according to data released by Baker Hughes on Friday. The tally in the Permian Basin of West Texas and New Mexico dropped by two to 486.

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