NEW YORK: Oil prices gained more than 1% on Wednesday on supply concerns as Opec+ agreed to leave their output policy unchanged and as the US barred Chevron from exporting Venezuelan crude.

Investors previously anticipated members of Opec+ would agree to a production increase later this week.

Brent crude futures settled up 81 cents, or 1.26%, to US$64.90 a barrel. US West Texas Intermediate crude gained 95 cents, or 1.56%, to stand at US$61.84 a barrel.

Opec+, the Organization of the Petroleum Exporting Countries and allies, did not change output policy. It agreed to establish a mechanism for setting baselines for its 2027 oil production.

Most oil-producing countries at the meeting do not have flexibility to adjust their output, said Bob Yawger, director of energy futures at Mizuho. "They were hoping to slow the pace of production increases and stop the slide in price. But that's not the way it panned out," he added.

A separate meeting on Saturday of eight Opec+ countries is expected to decide on an increase in oil output for July.

Goldman Sachs analysts saw the group of eight keeping production steady after the July hike.

"However, we see the risks to our Opec+ supply path as skewed to the upside, especially if compliance doesn't improve or if hard demand data surprise further to the upside," they added.

Coming demand for the summer driving season is significant, and with non-Opec+ crude output flat in the first half of the year, coupled with risks of Canadian wildfires hurting supply, the call on crude is stronger from Opec+, said Janiv Shah, vice president of oil commodity markets analysis at Rystad Energy.

On Wednesday, Chevron terminated the oil production, service and procurement contracts it had to operate in Venezuela, but it plans to retain its direct staff in the country, sources said.

Both benchmarks ticked up in the previous session on concerns of tighter supply after the US barred Chevron from exporting crude from Venezuela under a new authorization on its assets there.

Analysts also said prices could respond positively if there was progress on global trade talks or resolving US-Iranian friction.

Iran's nuclear chief Mohammad Eslami said on Wednesday it might allow the UN nuclear watchdog to send US inspectors to visit nuclear sites if Tehran's talks with Washington succeed.

US crude stocks fell by 4.24 million barrels last week, market sources said, citing American Petroleum Institute figures on Wednesday.

Market participants now await government data on crude inventories due Thursday. — Reuters