International benchmark Brent crude traded at $74.10 per barrel at 0925 GMT on Wednesday with a 0.32% decline after closing Tuesday at $71.34 a barrel.
American benchmark West Texas Intermediate was at $65.96 a barrel at the same time, down 0.30%, after ending the previous session at $66.16 per barrel.
Brent oil prices reached their highest levels of $74.65 on Tuesday, after U.S. Secretary of the State Mike Pompeo announced on Monday that the administration would no longer renew Iran sanctions’ waivers upon their expiration on May 2. The eight countries that the waivers apply to are Turkey, Japan, South Korea, China, India, Taiwan, Italy and Greece.
Prices slightly declined with signs of satisfactory supply levels on the market.
“Markets are now adequately supplied and that global spare production capacity remains at comfortable levels,” the International Energy Agency (IEA) said Tuesday adding that they are monitoring developments.
Global spare production capacity rose to 3.3 million barrels per day (mb/d), with 2.2 mb/d held by Saudi Arabia and around 1 mb/d by the U.A.E, Iraq and Kuwait, as a result of OPEC’s high compliance rate with the agreed supply cuts, the IEA said.
Additional supply is expected from the U.S. as output is estimated to grow by 1.6 mb/d this year, the agency added.
The IEA also notes that with “global economic growth increasingly fragile, consumers and producers should take steps to avoid higher oil prices that will prove painful to all alike.”