Increased demand and restricted supply caused oil prices to soar today with Brent crude oil reaching $79 (£58) per barrel which is the highest since November 2014.
Brent crude was up 20 cents at 77.32 dollars a barrel by 1315 GMT and USA light crude rose 10 cents to 70.80 dollars.
WTI's June contract was 67 cents higher at $71.63/bbl on the New York Mercantile Exchange as of 8:57 a.m. local time, after rising 26 cents on Monday.
It remains unclear how hard US sanctions will hit Iran's oil industry. This compares with 340 million barrels when OPEC, Russia, and several other producers agreed to cut production to stimulate prices.
The West Texas Intermediate (WTI) for June delivery was up 35 US cents to settle at 71.31 dollars a barrel on the New York Mercantile Exchange, while Brent crude for July delivery rose 20 cents to close at 78.43 dollars a barrel on the London ICE Futures Exchange.
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Oil prices rose as OPEC reported that the global oil glut has been virtually eliminated, while USA crude´s discount to global benchmark Brent widened to more than $7, its deepest in five months.
"In 2012, the reduction in Iranian crude production and exports were around 1 MMBPD", Wittner said, Reuters reported.
The bottleneck in North America likely contributed to a 4.9 million barrel rise in USA crude oil inventories, to 435.6 million barrels, that the private American Petroleum Institute reported on Tuesday.
Greg McKenna, chief market strategist at futures brokerage AxiTrader, says it is still "far from certain" that sanctions "will bite in the way intended".
US crude is trading at a hefty discount to Brent, the worldwide marker, thanks to sharp rises in USA production to 10.7 million bpd, which has left the American domestic oil market well supplied.
Meanwhile, Saudi Arabia pumped the least crude since output cuts began in early 2017, with all nations in the Organisation of Petroleum Exporting Countries except Iraq exceeding or matching curbs pledged under a deal aimed at clearing a glut. Fifty-five Palestinians were killed in confrontations with Israeli troops on Monday after tens of thousands converged on the Gaza Strip border to protest the USA embassy in Jerusalem.