Oil prices held firm on Tuesday as ongoing production cuts by OPEC and looming U.S. sanctions against Iran tightened the market amid signs of ongoing strong demand.
Brent crude futures, the international benchmark for oil prices, were at $78.30 per barrel at 0432 GMT, up 7 cents from their last close and not far off a three-and-a-half year high of $78.53 a barrel reached the previous session, as reported by Reuters.
U.S. West Texas Intermediate (WTI) crude futures were at $71.02 a barrel, up 6 cents and also not far off their Nov. 2014 high of $71.89 a barrel reached last week.
Markets have generally tightened as the Organization of the Petroleum Exporting Countries (OPEC), led by Saudi Arabia, has been withholding supplies since 2017 in order to push up oil prices.
With renewed U.S. sanctions looming against OPEC-member Iran, analysts said crude prices were well supported.
"The commitment of Saudi Arabia and the rest of OPEC to the production cuts is a major factor in supporting the price at the moment as well as the possibility of reduced exports from Iran due to sanctions," said William O'Loughlin, investment analyst at Rivkin Securities.
The OPEC cuts and looming sanctions come amid strong demand.
In China, the world's biggest oil importer, refinery runs rose nearly 12 percent in April compared with the same month a year ago, to around 12.06 million barrels per day, marking the second-highest level on record on a daily basis, data showed on Tuesday.
The tightening market has all but eliminated a global supply overhang which depressed crude prices between late 2014 and early 2017.
OPEC figures published on Monday showed that oil inventories in OECD industrialised nations in March fell to 9 million barrels above the five-year average, down from 340 million barrels above the average in January 2017.