(Investing) – Oil prices fell Friday after the Donald Trump administration eased some sanctions on Venezuela’s energy industry, but were still heading for hefty monthly gains on heightened geopolitical tensions in the Middle East.
At 08:55 ET (13:55 GMT), for March fell 0.6% to $69.16 a barrel, and fell 0.7% to $64.96 a barrel.
While prices fell from a near six-month high, they were set to rise around 13% this month, amid bets that geopolitical tensions in the Middle East and a bitter snowstorm in the U.S. will disrupt global supplies.
Trump administration eases some Venezuela sanctions
The Trump administration on Thursday lifted restrictions on transactions involving Venezuela’s state-run oil company PDVSA, which in turn allows for the sale and transportation of oil from the country by a U.S. entity.
The move appeared to be aimed at further bolstering confidence among American businesses to invest in Venezuela – a scenario that Trump had repeatedly called for after Washington seized control of the country’s energy industry earlier in January.
Still, Thursday’s move did not include language lifting sanctions on the production of Venezuelan oil.
The U.S. takeover of Venezuela’s oil industry had sparked concerns that oil supplies from the country would greatly increase with the lifting of American sanctions.
But analysts argued that a production ramp up in the country will take time, given Venezuela’s ageing energy infrastructure and heightened political uncertainty after the U.S. capture of President Nicolas Maduro.
U.S. raises pressure on Iran
However, crude prices has risen strongly earlier this week with U.S. President Donald Trump intensifying pressure on Iran to curb its nuclear program, threatening military action and deploying a U.S. naval group to the region.
Washington has imposed extensive sanctions on Tehran to choke off its oil revenue, a crucial source of state funding.
Trump is weighing targeted strikes on security officials and senior figures to stir unrest and potentially weaken the ruling system, Reuters reported on Thursday, citing U.S. sources.
“The market is becoming increasingly nervous over potential U.S. action in Iran, with U.S. vessels moving into the region and President Trump threatening an attack if Iran doesn’t make a deal regarding its nuclear program,” said analysts at ING, in a note. “Given Trump’s recent rhetoric, one would have to be fairly brave to head into the weekend short the market.”
OPEC+ likely to keep production unchanged
The Organization of Petroleum Exporting Countries and allies, known a OPEC+, is set to meet on Sunday, with recent reports indicating that the cartel is likely to keep its output unchanged.
The cartel had raised oil production by around 2.9 million barrels per day through 2025 – a move that battered oil prices. But then paused its monthly hikes from January, amid growing concerns over an oil supply glut and weakening global demand.
In a monthly market report released earlier in January, the OPEC+ had forecast that oil demand will improve in 2026 and 2027, and had also downplayed concerns over a supply glut.
Ambar Warrick contributed to this article
