Oil prices soared on Thursday, February 27, after United States President Donald Trump announced measures disrupting global crude supply chains.Brent crude futures for April delivery rose 2.08%, closing at $74.04 per barrel, while West Texas Intermediate (WTI) gained 2.52%, settling at $70.35 per barrel.These sharp increases reflect market fears over restricted supply following a series of geopolitical and trade policy moves.
Trump revoked Chevrons license to operate in Venezuela, cutting off one of the few remaining channels for Venezuelan crude exports.Simultaneously, the United States imposed fresh sanctions on Irans oil industry, further limiting global output from key suppliers.
Adding to the tension, Trump confirmed a 25% tariff on crude imports from Canada and Mexico, effective next week.These two countries are major suppliers to United States refineries, which rely heavily on their heavy crude blends.
The market reacted swiftly to these developments, with traders pricing in tighter supply amid growing geopolitical risks.Oil Prices Surge as United States Policies Tighten Global Supply.
(Photo Internet reproduction)Analysts noted that the revocation of Chevrons license alone could significantly impact Venezuelas already diminished oil exports.
Meanwhile, sanctions on Iran continue to reduce its ability to sell crude internationally, exacerbating the supply crunch.Despite these bullish factors, economic concerns tempered market sentiment.
Slowing United States GDP growth and rising unemployment claims raised fears about weaker oil demand in the coming months.Trade tensions with China also added uncertainty, with planned tariff hikes on Chinese imports set to take effect in March.
Technical analysis showed Brent testing resistance at $74.85 per barrel, with potential gains toward $77 if it breaks higher.WTI faced similar resistance near $70.38 but could see declines if it fails to hold current levels.
Energy-focused ETFs saw modest inflows as investors sought exposure to oil amid heightened geopolitical risks.However, analysts warned that economic headwinds and potential OPEC+ production increases could limit further price gains.
Global markets remain tense as traders monitor OPEC+ decisions and United States economic data for direction in March.The combination of supply constraints and demand concerns sets the stage for continued volatility in oil prices heading into next week.