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Crude oil prices are pulling back from three-and-a-half-year highs after a leap in the U.S. oil rig count and a relatively calm weekend when it came to geopolitical tensions. Drillers added 10 oil rigs and 3 gas rigs bringing the total oil rig count to 844, the highest level since March 2015, according to Baker Hughes.

Despite the U.S. pullout from the Iranian nuclear deal and Iran’s ill-fated attempt to lob missiles into Israel’s Golan Heights, the Iranians figured perhaps that the aggressive behavior might lose them support from China, France, Russia, Britain and Germany, who all want to stay in the Iranian nuclear accord.

Yet, the United States is warning that any company, foreign or domestic, that deals with Iran may be subject to actions from the United States. The Guardian reported that John Bolton, Donald Trump’s national security adviser, predicted that “the Europeans will see that it’s in their interests to come along with us” rather than continue with the 2015 deal, under which major European corporations have signed billions of dollars of contracts in Iran.

This comes as companies are seizing assets back from Venezuelans as the country is in total collapse. The Wall Street Journal reports that Conoco seized all of Venezuelan oil assets in Curacao and that a rush of creditors trying to seize assets has disrupted Venezuela’s oil exports at a time when they already are plunging.

The Journal also reports that ConocoPhillips has moved to take control of PDVSA facilities in the Caribbean after winning a $2 billion legal judgment tied to Venezuela’s seizure of its assets in 2007. That move alone hurts Venezuela because that storage and refining infrastructure is needed to blend the country’s heavy crude with lighter varieties and make it suitable for sale abroad. Energy economist Philip Verleger estimates the issue could cut off exports as much as 500,000 barrels a day out of the 1.4 million Venezuela produces. Coupled with renewed sanctions on Iran, the cutback could push oil prices above the current multiyear highs.

Oil prices are staying strong and while they are overbought there seems to be a period of consolidation which signals we should retest the highs again. Despite the best efforts of shale producers, U.S. refiners are dealing with the tightest supplies they have seen in years. While supplies in Cushing, Okla., are on the rise, the Gulf Coast gas has been draining and we are in an area that is giving the buyers of crude a wakeup call. Don’t count on our friends in OPEC looking to make up the difference. Reuters OPEC is more focused on identifying the right level of oil inventory at its next meeting, than the impact on supplies of new U.S. sanctions on Iran, the United Arab Emirates said.

Gasoline prices are at four-year highs as strong demand and the summer blend switchover is keeping them high. Jet fuel and diesel fuel prices are soaring as the shale oil is not yielding enough of those products. We are undersupplied which means refiners can’t max out gasoline. We have warned time and time again to remain hedged and while we may see some price relief in a couple of weeks after refinery maintenance season, the truth is there are still risks for price spikes all summer.