U.S. crude oil prices extended gains on Thursday, as the first round of sanctions against Iran went into effect.
West Texas crude oil futures rose 0.25% to $67.11 a barrel as of 10:39 AM ET (14:39 GMT). Meanwhile, Brent crude futures, the benchmark for oil prices outside the U.S., increased 0.54% to $72.67.
The first round of U.S. sanctions against Iran went into effect on Tuesday, while a second round is expected in early November. The second set of sanctions are expected to hit the countries energy infrastructure and oil exports, increasing the potential of a global energy supply shortage.
Many countries, including Europe, China and Russia, oppose the sanctions, but the White House wants other countries to stop buying oil from Iran.
Oil prices have been driven higher in the past few months as demand for oil outstrips supply. But trade tensions have weighed on markets. China is imposing a 25% tariff on $16 billion of U.S. imports in response to a U.S. tariff of the same amount on Chinese goods. As the two largest economies in the world go head-to-head over trade policies, investors worry about its potential impact on commodities and the global economy.
The U.S. Energy Information Administration reported that crude inventories fell less than expected, by 1.351 million barrels in the week ending August 3 compared to an expected decline of 2.8 million barrels.
The report also showed that gasoline inventories increased by 2.900 million barrels, compared to expectations for a decrease of 1.700 million barrels, while distillate stockpiles rose by 1.230 million barrels, compared to forecasts for a rise of 220,000.
In other energy trading, gasoline futures fell 0.22% at $2.0135 a gallon, while Heating Oil rose 0.48% to $2.1258 a gallon. Natural gas futures were down 0.37% to $2.938 per million British thermal units.