Brent crude futures were up 7 cents at $61.21 a barrel around 1:10 p.m. ET, while U.S. West Texas Intermediate futures were up 53 cents, or 1 percent, at $53.15.
Washington signaled it could impose sanctions on Venezuela’s crude exports as Caracas descends further into political and economic turmoil.
Venezuela’s opposition leader Juan Guaido declared himself interim president on Wednesday, winning backing from Washington and parts of Latin America and prompting socialist Nicolas Maduro, the country’s leader since 2013, to break relations with the United States.
Venezuelan oil is predominantly heavy crude, which requires extensive refining. It is frequently blended with lighter crudes to give refiners higher-value products.
With Iran already crippled by U.S. sanctions, a drop in Venezuelan exports could squeeze global supply further.
Geneva-based Petro-Logistics said on its website that Iranian crude and condensate exports in December “fell steeply” from November to less than 1 million barrels per day (bpd) due to U.S. sanctions — lower than some other estimates.
The Brent and WTI contract are both backed by light, sweet crude, and are not directly linked to Venezuelan oil.
But concern about the supply of heavy crudes is apparent in the U.S. physical market, where the price for Mars Sour, a medium crude, shot to its highest since early 2011.
Weighing on oil futures, U.S. crude inventories sharply rose by 8 million barrels last week, the Energy Information Administration said on Thursday, versus forecasts of a decline of 42,000 barrels.
“The report was rather bearish, punctuated by the large crude oil inventory increase,” said John Kilduff, partner at Again Capital Management. “Gasoline demand remains anemic.”
Worries about the longer-term outlook for global economic growth, and therefore demand for crude, has pressured oil prices.
Persistent concerns about the U.S-China trade war as well as slower world growth forecasts have kept investors wary.