Oil rises 2% to a 5-week high on supply concerns.
Brent crude futures rose $1,11, or 1,5%, to close at $74,74 a barrel.
(Reuters)- Oil prices closed up about 2%, hitting a five-week high on Monday, due to concerns that supply could decrease if US President Donald Trump follows through on threats to impose more tariffs on Russia and possibly attack Iran.
Brent crude futures rose $1,11, or 1,5%, to close at $74,74 a barrel, while U.S. West Texas Intermediate crude rose $2,12, or 3,1%, to close at $71,48.
This was the highest closing price for Brent crude since February 24th and the highest closing price for WTI crude since February 20th.
The premium for Brent crude over WTI fell to $3,02 per barrel, its lowest value since July 2024.
Analysts said that when the Brent premium over WTI falls below $4 per barrel, it doesn't make much economic sense for energy companies to send ships across the ocean to pick up oil from the US, which should result in lower US exports.
Trump said on Sunday that he was "angry" with Russian President Vladimir Putin and that he would impose secondary tariffs of 25% to 50% on buyers of Russian oil if he felt Moscow was hindering Trump's efforts to end the war in Ukraine.
"Trump's threat of secondary tariffs on Russian and Iranian oil is a factor that oil market participants are monitoring, although he has indicated that he does not plan to introduce them for now," said UBS analyst Giovanni Staunovo. "However, there is a growing risk of greater supply risks in the future."
The Kremlin said on Monday that Russia and the U.S. were working on ideas for a possible peace agreement in Ukraine.
