Oil prices edged higher on Wednesday on supply concerns with the U.S. stepping up efforts to curb Venezuelan and Iranian oil exports, while a bigger-than-expected draw in U.S. crude inventories also provided support.

Brent crude futures were up 20 cents, or 0.3%, at $73.22 a barrel by 0404 GMT, while U.S. West Texas Intermediate crude futures were up 20 cents, or 0.3%, at $69.20 a barrel.

Both contracts hit three-week highs in the previous session.

"Crude prices maintained a bullish bias after Trump's sanctions on Venezuelan oil, raising supply-side concerns," Priyanka Sachdeva, senior market analyst at Phillip Nova, wrote in a market commentary on Wednesday. On Monday, Trump signed an executive order authorizing his administration to impose a 25% across-the-board tariff under the International Emergency Economic Powers Act of 1977 on imports from any country that buys Venezuelan crude oil and liquid fuels.

Oil is Venezuela's main export. China, already the target of U.S. import tariffs, is its biggest buyer.

Venezuelan oil trade to major buyer China halted on Tuesday, as Chinese traders and refiners said they were waiting to see how the order would be implemented and whether Beijing would direct them to stop buying.

Last week, Washington also imposed new sanctions on Iranian oil sales targeting entities including Shouguang Luqing Petrochemical, a "teapot" or independent refiner in eastern China's Shandong province, and ships that supply oil to those plants in China, a major buyer of Iranian crude.

The market was also supported by data from the American Petroleum Institute showing U.S. crude inventories fell by 4.6 million barrels last week, a sign of healthy fuel demand in the world's largest economy.

Analysts polled by Reuters had forecast a 1 million-barrel draw.

Official U.S. government data on crude inventories is due on Wednesday.

The rise in oil prices is a temporary phenomenon, with the potential for an economic slowdown from Trump's tariffs limiting price gains, said Phillip Nova's Sachdeva.

Further limiting oil prices, the U.S. reached a deal with Ukraine and Russia to halt attacks at sea and on energy targets, with Washington agreeing to push for the lifting of some sanctions on Moscow.

Kiev and Moscow have both said they will rely on Washington to enforce the deal, while expressing skepticism that the other side will comply. (Newsmaker23)

Source: Reuters