Crude has rallied this month on concern that President Trump's decision to quit an worldwide accord with Iran and reimpose sanctions will strain global supplies just as markets are already tightening.
Crude rallied to $80 a barrel in London for the first time since late 2014 amid signals that stockpiles of excess oil will continue shrinking around the world.
An agreement between Saudi-led OPEC and Russian Federation on cutting oil production has helped push the price of oil from below $30 in 2016 to hit $80 on Thursday - the highest in almost four years.
"We are going to have reduced supplies from Iran in six months and Venezuela hasn't shown that they can stop the drop in their supplies", said the Vice President of Research at Tradition Energy, Gene McGillian.
The potential loss of 1 million barrels of Iranian crude from the world market and the ongoing decline of Venezuela's oil sector could push oil prices beyond $100/b, Patrick Pouyanne, chairman and CEO of French oil major Total, said Thursday.
Global oil supplies could be hit by the decision by the U.S. to pull out of the Iran nuclear deal, and also by falling production in crisis-hit Venezuela, the IEA said on Wednesday.
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The prospects of a drop in Iranian oil exports due to sanctions imposed by the United States after pulling out from the Iran nuclear deal has moved the prices northwards. Meanwhile, a majority of the growth in global oil production an be attributed to natural gas liquids and condensates, which both are useless in making middle distillates.
USA crude inventories (USOILC=ECI) fell by 1.4 million barrels in the week to May 11, compared with analyst expectations for a 763,000 barrel decrease.
Several banks have in recent days raised their oil price forecasts, citing tighter supplies and strong demand.
OPEC said on May 16 that the price of the OPEC basket of fourteen crudes stood at $75.47 a barrel on May 15, compared with $74.20 the previous day, according to OPEC Secretariat calculations.
"Strong global demand, an ongoing OPEC supply deal, and a rising tide of geopolitical risk all combine to force the market higher", said Robbie Fraser, commodity analyst at Schneider Electric.
But at this early stage in the US-Iran confrontation, another, even more important, economic question is worth considering: What will the US sanctions do to the price of oil?
Leading production increases is the United States, where crude output has soared by 27 percent in the last two years, to a record 10.72 million bpd, putting the United States within reach of top producer Russia's 11 million bpd.