Iran tightens supply, U.S. inventories fall, crude oil prices gain ground

Crude oil prices gained ground on global commodity indexes today, posting increases for the second consecutive sessions amid reports of falling inventories in the U.S. and supply disruptions out of Iran. Gains were tapered off somewhat by the lingering trader concerns surrounding the debt crisis in the euro zone. North Korean leader Kim Jong Il’s death may also hold longer term effects on the crude oil price charts.

The oil commodity futures rose nearly 1%, building on the fairly modest gains they reported during yesterday’s session. According to the latest reports from the U.S. Energy Department, stockpiles of the fuel in the nation fell 2 million barrels over the past week. Recent reports of steady declines stemming from the nation, the largest crude oil consumer in the world, have been one of most crucial lines of support for crude oil prices, which have suffering from high fluctuations and unclear global political conditions.

Investors and analysts are in the midst of adjusting their expectations for the fuel, a task that has seemingly become an impossible feat in the past few months, as global cues continue to shift towards opposite extreme seemingly overnight. However, the latest reports out of Iran stating that the prolific supplier nation is experiencing output halts due to a lack of investment is currently the primary factor at play on the sector charts. The disruptions in Iran’s production efforts come at the hands of the extensive sanctions that have been imposed on the OPEC country by the powers of the West, and though on a more immediate basis, Iran’s limited supply may boost crude oil price charts, the long term effect of its absence could be detrimental. Despite the fact that the U.S. is not reliant on Iran for its energy needs, the Middle Eastern country holds in its possession some of the key import/export routes of the region, and is directly responsible for supplying some Europe’s largest economies.

West Texas Intermediate crude oil prices for delivery in January, a contract that expires at the end of today’s session, gained 70 cents to $94.58 per barrel in electronic trading on the New York Mercantile Exchange. February’s contract increased 40 cents to $94.45 per barrel. Futures are up more than 3% for the year overall, compared to the 15% boost they built up over 2010.

Brent crude oil futures for settlement in February gained 66 cents to $104.30 per barrel on the ICE Futures Exchange in London. The spread between the two benchmarks currently sits at $9.68.

Some analysts have stated that if the sanctions against Iran persist, the nation would be forced to halt all exports, causing crude oil price charts to skyrocket by as much as $40 per barrel. Iran is currently is the second largest supplier of the fuel in OPEC. The pressure the nation has been experiencing over its nuclear program continues to rise, as the European Union in its entirety has now banned all Iranian banks from operating within the continent.

Crude oil stockpiles in the U.S. are expected to continue their declines, as refineries placed along the Gulf of Mexico are racing to reduce their tax bills before the end of the year.

WTI crude oil prices are now hovering around its closest point of technical resistance at $94.84 per barrel. Points of resistance on the sector charts typically signify clustered demand for the commodity.