Oil prices rose for a second day on Tuesday as fresh U.S. sanctions imposed on Middle Eastern producer Iran increased concerns supply might tighten and as global refining margins remained strong.

Brent crude futures rose 38 cents, or 0.5%, to $75.16 a barrel by 0401 GMT. U.S. West Texas Intermediate crude futures gained 47 cents, or 0.7%, to $71.17 a barrel. Both contracts gained in Monday's session after a $2 drop last Friday.

"In the short term, I continue to think crude oil is looking for a base. The fresh U.S. sanctions announced on Iran overnight will likely assist with this as will the Iraqi oil minister's commitment to reign in its oversupply," said IG market analyst Tony Sycamore.

The U.S. on Monday put new sanctions on more than 30 brokers, tanker operators, and shipping companies for their role in transporting Iranian oil. President Donald Trump has said he wants to bring Iran's crude exports to zero.

Iran is the third-largest producer in the Organization of the Petroleum Exporting Countries, pumping 3.2 million barrels per day in January, according to a Reuters survey of OPEC output.

For now, fuel demand strength in the West is also supportive of oil markets, some analysts say.

"Globally complex refining margins are looking robust, with strong fuel oil and distillates crack, particularly in USGC and NEW benefiting from the heating oil demand from the cold snap," said Sparta Commodities analyst Neil Crosby in a note, referring to the U.S. Gulf Coast and Northwest Europe.
Source: Investing.com