Crude oil prices at 5-month high on global supply concerns

Oil supply is starting to be affected by OPEC cutbacks: Former Shell Oil president

Former Shell Oil President John Hofmeister on the current state of the oil market.

Crude oil prices Monday jumped above $65 per barrel for the first time since November on concerns about how the U.S. termination of Iranian oil waivers will affect global supply.

The State Department was expected to announce Monday that it is ending waivers for five countries — including Turkey, South Korea and Japan — to import Iranian crude.

West Texas Intermediate, the benchmark American crude, climbed to its highest level since Oct. 31, 2018.

It was not immediately clear if any of the five would be given additional time to wind down their purchases or if they would be subject to U.S. sanctions on May 3 if they do not immediately halt imports of Iranian oil, according to The Associated Press. The other two countries are China and India.

The U.S. had previously granted eight nations a 180-day waiver to keep buying Iranian crude oil provided that they take steps to cut purchases and eventual end them altogether.

“I think it’s pretty clear that tightening supplies and receding fears of demand growth is a boost to the market to these 5-month highs,” Gene McGillian, Tradition Energy vice-president of market research in Stamford, Conn., told Reuters.

Concerns about global oil supplies also stemmed from the effect of American sanctions against Venezuela and civil unrest in Libya.

The Associated Press contributed to this report.