Oil prices are expected to end four consecutive days of gains as traders weigh the US crackdown on Venezuelan shipments amid weak demand.

West Texas Intermediate (WTI) prices fluctuated near $58 per barrel, while Brent neared $62. The US has boarded one tanker, seized another, and recently pursued a third near Venezuela, as Washington increases pressure on the government of Nicolas Maduro. However, more than a dozen vessels have loaded oil off the country's coast since the Trump administration stepped up efforts to curb Caracas's crude revenues.

Trading volumes tend to decrease ahead of the December holidays, with many traders on leave, contributing to excessive price fluctuations. Trump said the US would keep the oil from the seized tanker. Venezuelan exports represent less than 1% of global supply, but the revenue provides financial support for the Maduro government, which calls the US actions piracy.

Geopolitical pressures, including the threat of a US ground offensive against suspected drug operations in Latin America and the ongoing war in Ukraine, have helped halt the oil price decline that has been underway since mid-June. WTI is down about 19% this year, heading for its biggest annual decline since 2020, as rising supply outpaces demand.

"Price movements appear increasingly likely to be short-term spikes rather than sustained upward movements," said Rebecca Reed-Sperrin, a broker at SCB Group and former head of the derivatives brokerage desk at Braemar. "Even a sharp, short-term decline in Venezuelan exports would still keep the market well supplied through the first half of next year."

Meanwhile, a cargo of Russian crude from US-sanctioned Rosneft PJSC has finally been delivered to a Chinese oil terminal after spending three months at sea, according to ship tracking data.

WTI for February delivery fell 0.310% to $57.83 per barrel at 10:41 a.m. in New York. Brent crude for February settlement fell 0.387% to $61.83 per barrel. (alg)

Source: Bloomberg