Iran's Oil Exports Slip for Third Consecutive Month over U.S. santionsNaija247news

Iran's Oil Exports Slip for Third Consecutive Month over U.S. santionsNaija247news

Brent crude oil futures were at $74.61 per barrel, lower 4 cents from their previous close. "They are battling with poorer margins due to government tax interventions and higher oil prices", Commerzbank said in a note.

Looming US sanctions against Iran will likely hit Tehran's oil sales overseas, and it could lead to a price spike in oil contracts.

A greater commitment to US crude may help shield India from supply disruptions when sanctions on oil aimed at curbing the Islamic republic's nuclear program begin in early November.

Oil prices dipped on Wednesday after China reported relatively weak import data, although the market remained well supported by falling USA crude inventories and the introduction of sanctions against Iran. "That said, the sanctions may heighten geopolitical tensions in the Middle East, which are likely to weigh on local financial markets", they said. This is something that the market desperately needed, after getting slammed the previous day.

US crude production has climbed dramatically, fueled largely by increased output from shale formations, but may now rise more slowly as prices drop.

The first round of renewed USA sanctions will take effect on Tuesday with the harshest sanctions, potentially targeting Iran's oil industry, expected to return in early November.

Exxon Mobil Corp. (NYSE: XOM) traded down about 0.8%, at $80.62 in a 52-week range of $72.16 to $89.30.

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The Vienna conference analysed oil market developments since it met in Vienna at the end of November and reviewed the oil market outlook for the remainder of 2018.

Since late 2016, the Organization of Petroleum Exporting Countries and other nations, including Russia, Kazakhstan and Mexico, have managed the oil market, giving birth to a group popularly known as OPEC+.

Though China could indeed see oil demand growth slow in coming months, in part due to the ongoing trade row with the USA, in the mid to long term China's oil consumption thus its reliance on foreign oil will continue to grow.

U.S. President Donald Trump tweeted that the sanctions were "the most biting sanctions ever imposed".

The market was also bolstered by a report on Tuesday from the American Petroleum Institute (API), which said crude inventories fell by 6-million barrels in the week to August 3 to 407.2-million. As a result, more US crude oil would be shipped to Asian market. Refinery utilization rates rose by 0.5 percentage point.

"Fears of the impact of sanctions on China, Iran, Russia and Turkey did not help and another big drop in US gasoline demand has some anxious that U.S consumers were showing resistance to higher pump prices", Phil Flynn, a market analyst at the PRICE Futures Group in Chicago, said in a daily emailed market report.

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