Home / International/ Oil drops as US considers granting some waivers on Iran crude sanctions

Oil drops as US considers granting some waivers on Iran crude sanctions


Comments / {{hitsCtrl.values.hits}} Views / Tuesday, 9 October 2018 00:00

Facebook

 

SINGAPORE (Reuters): Brent crude oil prices fell more than 1% on Monday after Washington said it may grant waivers to sanctions against Iran’s oil exports next month, and as Saudi Arabia was said to be replacing any potential shortfall from Iran.

International benchmark Brent crude oil futures LCOc1 were at $ 83.26 per barrel at 0352 GMT, down 90 cents, or 1.1%, from their last close.

US West Texas Intermediate (WTI) crude futures CLc1 were down 54 cents, or 0.7%, at $ 73.80 a barrel.

US sanctions will target Iran’s crude oil exports from 4 November, and Washington has been putting pressure on governments and companies worldwide to cut their imports to zero.

However, a US Government official said on Friday that the country could consider exemptions for nations that have already shown efforts to reduce their imports of Iranian oil.

In a sign that Iran oil exports won’t fall to nothing from November, India will buy nine million barrels of Iranian crude next month, Reuters reported on Friday.

Hedge funds cut their bullish wagers on US crude in the latest week to the lowest level in nearly a year, data showed on Friday.

Traders said ongoing concerns that the US-Chinese trade war could slow down economic growth also weighed on crude on Monday.

China’s stocks fell sharply on Monday despite an announcement from Beijing over the weekend that it would slash the level of cash that banks must hold as reserves, a sign of underlying investor anxiety over the heated Sino-US trade war.

Further weighing on oil prices was “chatter that Saudi Arabia has replaced all of Iran’s lost oil”, said futures brokerage Oanda, Singapore, Head of Trading for Asia-Pacific Stephen Innes.

But, Innes warned that limited spare production to deal with further supply disruptions meant “the capacity is quickly declining due to Asia’s insatiable demand”.

The US oil drilling rig count fell for a third consecutive week, as rising costs and pipeline bottlenecks have hindered new drilling since June.

Drillers cut two oil rigs in the week to 5 October, bringing the total count down to 861, energy services firm Baker Hughes said in its weekly report on Friday. That is the longest streak of weekly cuts since October last year.

With Iran sanctions still on the table, potential spare capacity constraints and also a slowdown in US drilling, US bank J. P. Morgan said in its latest cross-asset outlook for clients that it recommended to “stay long January ‘19 WTI on supply risks to crude”.


Share This Article

Facebook Twitter


DISCLAIMER:

1. All comments will be moderated by the Daily FT Web Editor.

2. Comments that are abusive, obscene, incendiary, defamatory or irrelevant will not be published.

3. We may remove hyperlinks within comments.

4. Kindly use a genuine email ID and provide your name.

5. Spamming the comments section under different user names may result in being blacklisted.

COMMENTS

Today's Columnists

Is Sri Lanka under the dominance of a powerful cabal?

Saturday, 15 June 2019

There is a saying that “A fish rots from the head”. That is the expression used when a country’s leadership is seen as responsible for violence and unethical behaviour of its supporters and the citizens in general - agitating the majority commu


Behind the scenes

Saturday, 15 June 2019

We see and hear many things happening on the stage. Some we only hear about and do not see. More things are happening without being seen clearly. An observation with extensive view and survey will be the only means of bringing to light the true natur


My way or the Huawei: global battle for 5G dominance and its impact on Sri Lanka

Friday, 14 June 2019

The ongoing battle between the US and the Chinese tech giant Huawei is escalating due to both parties’ eagerness to dominate 5G technology, the next major global technological revolution. It will define the future of the World Wide Web, creating a


Plunder of public property by rulers

Friday, 14 June 2019

While the failure to build the modern nation has been the prime factor that had caused the wretchedness of Sri Lanka, plundering of public property by rulers when they are under their custody can be considered the next vital factor that had exacerbat


Columnists More