Oil hits two-month high as US threatens Venezuela sanctions – business live

The oil price is rallying this morning, following reports that the US government could hit Venezuela with sanctions.

Brent crude has jumped to $52.85 per barrel, its highest level since late May, and US crude is back over the $50/barrel mark.

The surge comes after US officials expressed anger over a controversial election held in Venezuela last weekend to choose delegates for its assembly, and to rewrite its constitution.

Critics claimed that the vote was designed to shore up president Nicolas Maduro’s government. It was marred by violent clashes between opposition supporters and troops, with at least three people killed over the weekend.

Nikki Haley, the US ambassador to the United Nations, has already warned Maduro that the result isn’t acceptable.

US State Department spokesperson Heather Nauert also warned:

“We will continue to take strong and swift actions against the architects of authoritarianism in Venezuela, including those who participate in the National Constituent Assembly as a result of today’s flawed election,”

“We encourage governments in the hemisphere and around the world to take strong action to hold accountable those who undermine democracy, deny human rights,bear responsibility for violence and repression, or engage in corrupt practices.

And a formal US response is expected soon, with officials briefing that they could impose sanctions on Venezuela’s vital oil sector this week.

Reuters has more details:

The measures, which could be announced as early as Monday, are not expected to include a ban on Venezuelan oil shipments to the United States — one of the harshest options — but could block sale of lighter U.S. crude that Venezuela mixes with its heavy crude and then exports, the officials told Reuters.

More reaction to follow…

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

Today we get a new healthcheck on Britain’s economy, with new figures showing how much new credit was lapped up by consumer last month, and how many people took out mortgages.

With concerns over Britain’s economy mounting, City investors will scrutinise the data for signs that cash-strapped households are taking too many risks.

Michael Hewson of CMC Markets has the City predictions:

Mortgage approvals for June are set to remain steady at 65k, while net lending is expected to slow down a touch from the numbers seen in May, as declining consumer confidence and rising inflation squeezes wages, not to mention the uncertainty created by the June election result.

The main event of the morning, though, could be the latest eurozone inflation and jobs report. They could show that Europe’s recovery is continues, with unemployment tipped to hit a new post-crisis low of 9.2% in June.

Royal Bank of Canada’s analysts warn that Europe’s labour market still has black spots:

The pace of improvement is still gradual, due in particular to the continued sluggish performance of the French and Italian labour markets, meaning that the considerable degree of labour market slack that exists in the euro area continues to be absorbed only slowly.

Eurozone inflation, meanwhile, is expected to remain at 1.3% in July — not high enough to worry the European Central Bank unduly.

Also, the Bank of England will make a final attempt to avert its first strike in half a century. The central bank will meet with union officials today, with a three-day walkout over pay due to start tomorrow:

The agenda

• 9.30am BST: UK consumer credit and mortgage approvals for June
• 10am BST: Eurozone unemployment figures for June
• 10am BST: Eurozone inflation data for July
• 3pm BST: US pending home sales