Oil prices fall on rising USA crude inventories,…

Prices are likely to be unpinned all week because the deadline for a decision on Iran is May 12.

SINGAPORE, May 7 (Reuters) - U.S. oil prices rose above $70 a barrel on Monday for the first time since November 2014 while Brent crude prices climbed to fresh highs, as a deepening economic crisis in Venezuela threatened the country's already tumbling oil supplies.

Oil prices have been climbing partly because of expectations that US President Donald Trump will abandon the 2015 Iran nuclear deal, which allowed Tehran to export more crude, reports CNN. "Investors are anxious about supplies after Iran took a tough stance in its response to the United States", Wang Xiao, Head of Crude Research with Guotai Junan Futures said, adding prices may fall if expectations for new sanctions ease. And one of the factors for the WTI crude price being lower than Brent is the domestic shale production, which has been booming.

If the United States imposes sanctions that will prevent those who do business with Iran from accessing the United States financial market, this could also mean that other countries will also stop buying Iranian oil.

If sanctions were re-imposed on Iran, it could once again increase the amount of oil it produces, in complete contrast to other members of the Organization of the Petroleum Exporting Countries (OPEC) and Russian Federation, who have kept a tight control on global output to buoy up the prices.

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This is raising concerns over a possible disruption in crude oil supply from the Middle East. But it's the Iran question that's driving short-term trading, experts say. The market has priced in more than a 50 percent probability that the U.S.'s waiver against Iran won't be extended, but there's still "significant upside" should the waiver lapse, the bank said. "I'm not telling you what I'm doing, but a lot of people think they know".

United States light crude settled up $1.29 at $69.72 a barrel.

But Shum said the impact is unlikely to be as severe as the multinational sanctions imposed on Iran in 2012. Meanwhile, America's European allies continue to back it, saying the deal has been essential to reining in Iran's nuclear program. Iran also doesn't support higher oil prices, with its oil ministers saying they wanted reasonable oil prices, well below $70.

"Investors are anxious about supplies after Iran took a tough stance in its response to the United States", Wang Xiao, Head of Crude Research with Guotai Junan Futures said, adding that prices may fall if expectations of new sanctions ease.

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