U.S. oil prices spiked Wednesday to levels not seen since 2014 as crude supplies experienced their largest drop of the year even as oil-producing nations promised to increase production.
Prices are set to top the $72.35 per barrel finish on the New York Mercantile Exchange, which is the highest since November 2014. The highs come as the Organization of Petroleum Exporting Countries (OPEC) nations promised to ramp up oil production to stave off higher prices.
Crude supplies declined 9.9 million barrels for the week ending June 22, the largest weekly decline in a year, according to a report Wednesday from the U.S. Energy Information Administration Analysts had previously forecast a fall of 2.3 million barrels.
The uptick in prices also come a month after President Donald Trump pulled the U.S. out of a 2015 international agreement to curb Iran’s nuclear program, a move some analysts warn would lead to an increase in international prices.
Iran exports 2.4 million barrels a day of crude. Analysts had estimated that anywhere between 400,000 to a 1 million barrels could be at risk once sanctions are fully implemented. (RELATED: OPEC Reaches Decision On Oil Production)
Members of OPEC were able to reach a compromise during a June 22 meeting in Austria. The group overcame objectinos from Iran and agreed to increase oil production by 600,000 barrels per day.
The decision comes as a compromise after Iranian oil minister Bijan Zangeneh walked away from negotiations on Thursday when Russia and Saudi Arabia called for an increase in production by 1 million barrels per day.
Iran vehemently objected to Trump’s tweet on June 13 that blamed the oil cartel for rising gas prices. The U.S. is to blame for rising international oil prices, Zangeneh said in response, citing Trump’s withdrawal of the Iran Agreement.
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