RoydadNaft –  Oil prices edged higher on Monday, supported by disruptions in Venezuelan oil exports following U.S. sanctions and the seizure of a tanker, which partially offset broader concerns about global oversupply and the potential for a Russia-Ukraine peace deal.

According to Roydad Naft, as of 0725 GMT, Brent crude futures climbed 30 cents, or 0.49%, to $61.42 per barrel, while U.S. West Texas Intermediate crude rose 28 cents (0.49%) to $57.72. Both benchmarks had fallen more than 4% the previous week, largely due to expectations of a supply surplus in 2026.

Analysts pointed to conflicting market signals: escalating U.S.-Venezuela tensions have sharply curtailed Venezuelan shipments, with reports indicating plans for further U.S. seizures of tankers carrying the country’s oil. This short-term supply tightness provided bullish support.

However, long-term oversupply worries persisted. JPMorgan forecasted that oil surpluses would widen in 2026 and 2027, with supply growth outpacing demand by a factor of three.

Geopolitical developments also fostered caution. Progress in Russia-Ukraine peace talks—including Ukrainian President Volodymyr Zelenskiy’s proposal to forgo NATO membership—raised the prospect of increased flows of sanctioned Russian oil into global markets if sanctions are eased. At the same time, a Ukrainian attack halted operations at a major Russian refinery.

Drilling activity in the U.S. slowed, with oil and gas rig counts dropping for the second time in three weeks, according to Baker Hughes data.

Overall, traders remained cautious, with one economist warning that without a sharp escalation in geopolitical risks, WTI prices could fall below $55 early next year.