Oil traders, Keep An Eye on the UK Brent Crude Oil

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Prices haven't see levels this high since November 2014.

"The potential double supply shortfall represented by Iran and Venezuela could present a major challenge for producers to fend off sharp price rises and fill the gap, not just in terms of the number of barrels but also in terms of oil quality", it said.

Brent crude futures (LCOc1) gained 85 cents to settle at $79.28 a barrel, while US crude futures gained 18 cents to settle at $71.49 a barrel.

EIA's latest weekly petroleum report will certainly fuel the bullish sentiment on the oil market even though some analysts are noting that financial demand for crude oil greatly exceeds physical demand, with spot oil prices at the deepest discount to futures in years.

Following the rally in crude oil prices, the National Assembly increased the oil benchmark price for the 2018 budget to $51 per barrel from $45 proposed by the Executive.

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Still, even more cautious analysts admit that the OPEC+ production cut deal has served its goal and global oil supply is a lot tighter than it was just two years ago. Thus, fear of investors to reduce supply drives amount upward.

Back on Nymex, June gasoline RBM8, -0.04% rose 1% to $2.272 a gallon, while June heating oil HOM8, +0.45% rose 1.3% to $2.299 a gallon.

"I think there's more upside at the moment than downside, the new range is $72-$85", said Michael Hewson, chief market analyst at CMC Markets, adding that he "wouldn't rule out" $90 brent this year. For its part, Diesel has marked a new annual maximum and levels that were not seen since December 2014 to be in 1.207 euros, a rise of 1.42%, according to data from European Union oil bulletin.

Oil's rise to $80/bbl is stoking concerns that the price rally will erode demand, but OPEC's giants so far aren't anxious.

OPEC members can replace any supplies lost from Iran, and the U.S.is pumping at record levels, Anthony Grisanti, president and founder of GRZ Energy, told CNBC.

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French oil major Total said Wednesday it will halt a $5 billion natural gas development in Iran unless it receives a waiver from the USA government.

The two ministers, in a joint statement, blamed volatility in prices on global political tensions.

On the New York Mercantile Exchange, June West Texas Intermediate crude CLM8, -0.43% the USA benchmark, were up 37 cents, or 0.5%, at $71.86 a barrel, on track to notch another 3½-year peak. Now, up to a third of its remaining one million barrels a day in exports are at risk because of the near-collapse of the state oil company, sanctions and the new confrontation with ConocoPhillips.

"With trade skirmishes between the USA and China and all kinds of political issues, I see the resistance from Chinese crude buyers to comply" with United States sanctions, he said.

At 432.4 million barrels, US crude oil inventories are in the lower half of the average range for this time of year.

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Prior to Thursday's peak oil prices had already been rising thanks to steady demand growth and a landmark deal by oil producing countries, both inside and outside the OPEC cartel, to lower output by 1.8 million barrels per day till end 2018.

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