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Iran oil minister reiterates Trump to blame for rising crude prices

07 October 2018

Oil prices declined from four-year highs Thursday, but markets remained focused on worries that USA sanctions against Iran oil exports could create global supply deficits. USA officials have said new sanctions will be imposed on Iran's oil sector from November 4. Meanwhile, the industry-funded American Petroleum Institute was said to report stockpiles rose by 907,000 barrels last week. After the JCPOA and the European Union agreed to relieve sanctions imposed on Iran on the condition that the country curb its nuclear capacity in July 2015, Iran's crude exports saw a slight increase in 2016, reaching 1.9 million bpd and jumped to 2.1 million bpd in 2017, according to data compiled from OPEC.

Further, Saudi Arabia and Russian Federation recently agreed privately to boost supply before telling other OPEC countries in an effort to mollify U.S. President Donald Trump, who has focused his anger on rising prices.

The government also expected to sell 2.4 million barrels per day of oil during the current Iranian calendar year, which started in mid-March, but it exported 2.5 barrels in reality, he said.

U.S. West Texas Intermediate (WTI) crude futures were up just 1 cent at $75.24 a barrel. Tokyo has been seeking a United States exemption for its Iranian oil imports as it sees the supplies as important for the country's energy security and businesses.

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Brent for December delivery was fetching around $85.30 per barrel in late London business versus $81.50 per barrel at the same time the previous week.

President Donald Trump pulled the U.S. out of the 2015 nuclear accord, saying it had "failed to achieve the fundamental objective of blocking all paths to an Iranian nuclear bomb" and did not deal with Tehran's "malign activities, including its ballistic missile programme and its support for terrorism".

"They're taking a pause after yesterday's sell-off", said Andrew Lipow, president of Lipow Oil Associates. This singular event is being seen as the spark that will ignite $100 oil. After about 18 months of restraining supply, OPEC agreed to increase output.

Oil has been rallying as shrinking output from Venezuela to Iran stoked worldwide concern about a supply crunch.

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"We protect Saudi Arabia — would you say they're rich?"

“The market mood is exceptionally bullish, with fears growing that the USA demands for an Iran oil embargo could cause a significant supply shortfall, ” said Norbert Rucker, head of macro and commodity research at Julius Baer.

"This is created in financial markets", he said.

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Iran oil minister reiterates Trump to blame for rising crude prices