Crude oil prices soared to near six-month highs Monday morning amid speculation the U.S. is likely to halt the waivers it had offered to importers of Iranian oil.
The unexpected drop in U.S. crude inventories in the week ended April 12, the drop in U.S. rigs count last week, the U.S. sanctions of Venezuela and supply disruptions in Libya too continue to support oil prices.
West Texas Intermediate Crude oil futures for May rose to $65.87 a barrel and are currently up $1.55, or 2.4%, at $65.55 a barrel.
WTI crude futures for June are up $1.50, or 2.35%, at $65.57 a barre.
Brent crude futures for June rose to $74.31, before paring some gains. Still, at $73.85 a barrel, the contract is up $1.88, or 2.6%, from previous close.
In November 2018, the U.S. had granted six-month waivers to major importers of Iranian oil, including India, China, Japan and South Korea.
According to a report in Washington Post, the U.S. is preparing to announce that all importers of Iranian oil will have to end their purchases shortly or face U.S. sanctions.
India, China, Japan and South Korea were among the countries that were allowed to continue buying oil from Iran.
Meanwhile, according to reports, Saudi Arabia may increase output to offset any shortage in supply due to the U.S. administration's likely tougher stance on sanctions against Iran.