Oil markets spiked on Monday on fear over possible renewed U.S. sanctions against Iran while a decreasing U.S. rig count boosted prices as well.
The international benchmark for oil prices, Brent crude futures LCOc1, closed at $57.82 at 01:56 GMT, 1.1 percent or 65 cents higher than the previous close. WTI crude futures advanced by 0.8 percent towards $51.88 per barrel.
On Friday, Donald Trump, the U.S. president, struck a blow against the 2015 Iran nuclear deal, disregarding both U.S. associates and rivals by declining to formally certify that Tehran is following with the accord even though international inspectors says it is. According to U.S. law, every 90 days, the president must certify to Congress that Iran is complying with the deal. Then, within 60 days, it is up to the U.S. Congress to decide whether to re-impose economic sanctions on Tehran.
About 1 million barrels per day of crude oil supplies were cut off from global markets during the previous round of sanctions against Iran. The renewed sanctions will undoubtedly have a huge impact on prices according to analysts especially as the U.S. would probably act alone.
Asian markets experienced a rally on account of positive inflation data from the United States indicating a continual growth of the American economy without too much inflationary pressures.
The Nikkei 225 went higher by 0.7 percent. The Topix added 0.5 percent to its value. The South Korean Kospi rose by 0.4 percent. In Australia, the ASX 200 climbed by 0.7%.
In the forex market, the dollar index lost 0.6%. The Japanese yen closed at $111.91. The Japanese currency strengthened by 0.4 percent on Friday. The euro kept stable at $1.1818.