Oil under pressure from rising output, but Iran sanctions loom

Oil under pressure from rising output, but Iran sanctions loom

Oil under pressure from rising output, but Iran sanctions loom

The increase in OPEC production "has really started to tamp down concerns surrounding the loss of Iranian barrels".

Futures in NY fell as much as 0.9 percent, after falling 1.3 percent on Wednesday.

In a bearish signal, the American Petroleum Institute reported USA crude inventories rose 5.7 million barrels last week, more than analyst's forecasts for a 4.1 million barrel build.

With Russia pumping oil at a post-Soviet high, USA crude output at more than 11 million barrels per day (bpd.), concerns about renewed US sanctions on Iran have faded in recent days. A rally in the greenback this week has also diminished the appeal of commodities priced in dollars.

"The U.S.is well aware of our requirement for oil domestically, which is critical for sustaining our economic growth".

"India and the U.S. have broadly agreed on waiver. It's an economic evaluation for us, if there are no boundary lines drawn, and it makes economic sense, it will be bought". Saudi Arabia and Russian Federation have said they will pump enough to meet demand once USA sanctions are imposed.

Front-month Brent crude futures, the worldwide benchmark for oil prices, were at $72.86 per barrel at 0041 GMT on Friday, down 3 cents from their last close. The contract is down 5.6 percent this week for a fourth consecutive week.

Brent for January settlement rose 0.5 percent, or 36 cents, to $73.25 a barrel on the London-based ICE Futures Europe exchange. The December contract fell 44 cents to $75.47 before expiring on Wednesday. The global benchmark crude traded at $9.33 premium to WTI for the same month.

Oil is poised for the biggest weekly loss since February on concerns over growing supply at a time when speculation is increasing that US sanctions on Iran won't cut the OPEC producer's exports to zero.

US Secretary of State Mike Pompeo said in September that the White House would only consider waivers for Iran's oil buyers if they vowed to eventually bring their imports to zero. America wants to put maximum pressure on Iran, but doesn't "want to hurt friends", he said. The U.S. surpassed Russian Federation in August, with the largest year-on-year supply increase in U.S. history. Rouhani urged Parliament to approve four new ministers and help his government "resist" and "fight" the U.S.as it reinstates sanctions against the Islamic Republic. "The United States government now is in the middle of an internal process to consider significant reduction exemptions for individual countries".

Traders said oil received some support from stock markets, which pulled back from 20-month lows on Wednesday amid pledges by China to support its markets.

Brent and USA crude posted their biggest monthly percentage decline since July 2016 in October, with Brent down 8.8 percent for the month and US crude losing almost 11 percent.

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