"Oil cut earlier losses and rose towards its highest level this year on Wednesday, after a drop in US crude inventories and as the prospect of the loss of Iranian supply added to concerns over the delicate balance between consumption and production". Supplies at the key storage hub in Cushing, Oklahoma, rose by an estimated 900,000 barrels last week, according to a Bloomberg forecast.
Light, sweet crude for October delivery dropped $1.78, or 2.5%, to $68.59 a barrel on the New York Mercantile Exchange, its worst day since August 15 after it closed at its highest level since July 20 a session earlier. WTI futures gained 2.5 percent in the previous session.
Brent crude futures slipped 38 cents, or 0.5 percent, to $79.36 a barrel. The global benchmark fell 2 percent on Thursday after rising on Wednesday to its highest since May 22 at $80.13.
Crude inventories fell 5.3 million barrels in the week to September 7 to 396.2 million barrels, the lowest level since February 2015, and about 3 percent below the five-year average for this time of year, the EIA said.More news: Here's your sign: Waffle House closed until after Florence
USA nationwide crude inventories may have fallen 2.25 MMbbl last week, according to a Bloomberg survey of analysts ahead of government data due to be released on Wednesday.
South Korea has become the first of Iran's top-three oil customers to cut imports to zero before US sanctions take effect in November.
Washington has told its allies to reduce imports of Iranian oil and several Asian buyers, including South Korea, Japan and India appear to be falling in line. However, the drop has only seen exports fall to near March 2016 levels, when the USA was not pursuing a sanctions policy against Iran and the Iran nuclear deal, officially known as the Joint Comprehensive Plan of Action (JCPOA), was in effect.
She further said that the two sides also talked about how United States expects other countries to bring their oil imports from Iran "down to zero as quickly as possible" and on USA efforts to ensure that the restrictions do not disrupt the market, she said. The situation should be closely watched, the right decisions should be taken, " Novak reportedly said.More news: Details emerge about Browns' decision to part ways with Josh Gordon
Such concerns have prompted U.S. Energy Secretary Rick Perry to meet his Saudi and Russian counterparts in an effort to convince those two countries to keep oil output high in order to offset a reduction in future Iranian oil exports.
"Russia has potential to raise production by 300,000 barrels (per day) mid-term, in addition to the level of October 2016", he said.
Also, this past week, the EIA reported weekly data that showed an uptick in gasoline inventories, a bearish sign that signals both an end to summer driving season and possibly hints at a slowdown in demand more generally.
Prices were also pushed up by Hurricane Florence, which is expected to make landfall on the U.S. East Coast on Friday, and which has caused fuel shortages following the evacuation of millions of households and businesses.More news: Storm Moving Closer to US
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