Published: Sat, October 13, 2018
Markets | By Otis Pena

Worlds top traders divided on oil outlook as Iran sanctions loom

Worlds top traders divided on oil outlook as Iran sanctions loom

Both benchmarks fell for the first time in five weeks, pressured by a big rise in US inventories and fading concerns about shrinking global supplies due to looming USA sanctions on Iran's oil exports.

Brent crude futures fell $US2.83 overnight to settle at $US80.26 a barrel, a 3.41 per cent loss, after hitting a low of $US79.80, its weakest since September 24.

Brent crude futures rose $1.09 to settle at $85.00 a barrel, a 1.30 percent gain.

In the U.S. Gulf of Mexico, producers have cut daily oil production by roughly 42% due to Hurricane Michael, the Bureau of Safety and Environmental Enforcement said.

Crude inventories rose by 6 million barrels in the week to October 5, data from the Energy Information Administration showed on Thursday.

Bob Dudley, CEO at BP, said, "I think it's going to be 45 days of extreme volatility, it could spike up, it could also go the other way", the latter scenario occurring "if waivers [from the U.S.] were granted to others, to big oil consuming countries" that would allow them to import Iranian crude.

Iranian Oil Minister Bijan Zanganeh on Monday described a Saudi claim that the kingdom could replace Iran's crude exports as "nonsense".

The Organization of the Petroleum Exporting Countries (OPEC) downgraded its global oil demand estimate due to changes in economy forecasts for Turkey, Brazil, Argentina, a report by the OPEC showed Thursday.

Takeaways from the UN's Startling Climate Report
UNDP is proud of providing technical support to this process together with GIZ and other development partners, she stressed. For Canada, that means emissions would need to fall to a maximum of 385 million tonnes a year.

The cuts represent 680,107 barrels per day of oil production, BSEE said, citing reports from 30 companies.

The South Asian nation was hoping to lift significantly higher volumes in the current fiscal year, after Tehran offered a discount on shipping and an extended credit period, before the US decision on sanctions changed its plans.

They earlier touched their lowest since September 27 at $81.35, after closing 2.2 percent lower on Wednesday.

Supply worries also eased as Hurricane Michael likely spared oil assets from significant damage as it smashed into Florida, even as it caused at least one death and widespread destruction.

In the last financial year 2018, India, which is the world's third-largest oil consumer, consumed 204.9 million tonnes of 4 million barrels of oil per day.

US light crude was up 40 cents at $74.69.

"The bearish alarm bells are ringing for next year's oil balance as market players brace for the return of a supply surplus", said Stephen Brennock of oil broker PVM. "In 2019, world oil demand growth is forecast at 1.36 mb/d, down by around 50 tb/d from last month's projections, mainly reflecting adjustments in the economic projections for Turkey, Brazil and Argentina", the report read.

Like this: