Oil prices held firm on Friday on strong demand, ongoing supply cuts led by producer cartel OPEC and looming U.S. sanctions against major crude exporter Iran, a Reuters report said.
But markets remained below multi-year highs from the previous day as surging output from the United States is expected to offset at least some of the shortfalls.
Brent crude futures LCOc1 were at $79.55 per barrel at 0651 GMT, up 25 cents, or 0.3 percent, from their last close. Brent broke through $80 for the first time since November 2014 on Thursday.
U.S. West Texas Intermediate (WTI) crude futures were at $71.65 a barrel, up 16 cents, or 0.2 percent, from their last settlement.
Crude prices have received broad support from voluntary supply cuts led by the Organization of the Petroleum Exporting Countries (OPEC) aimed at tightening the market.
“Global inventories are approaching long-run averages, suggesting that the coordinated OPEC/non-OPEC supply cuts have been successful,” said Jack Allardyce, oil and gas research analyst at Cantor Fitzgerald.
Beyond OPEC’s cuts, strong demand as well as falling output from Venezuela and a U.S. announcement earlier this month to renew sanctions against OPEC-member Iran helped push up Brent by 20 percent since the start of the year.
U.S. investment bank Jefferies said sanctions against Iran could remove more than 1 million barrels per day (bpd) from the market.