US crude was down $1.14 at $73.20. A government official added that the administration was in the middle of an internal process of considering waivers called significant reduction exemption.
But Iran, OPEC's third-largest producer, has repeatedly said that its oil exports can not be reduced to zero because of high demand levels in the market and has blamed Trump for an oil price rally caused by imposing sanctions on Tehran.
The country previously held oil in storage at Dalian during the last round of sanctions in 2014 that was later sold to buyers in South Korea and India.More news: Melania Trump On Me Too: We Should Support Men, 'Not Just Women'
International Olympic Committee and Mangalore Refinery and Petrochemicals Ltd (MRPL) together have placed order for 1.25 million tonne (MT) of crude oil from Iran.
Another factor easing those fears was a Friday Reuters report that cited an unnamed us government official as saying the Trump administration is considering waivers on its sanctions for countries that agree to reduce their imports of Iranian oil.
He said that nine million barrels of oil are expected to be purchased.More news: 'Prove' Jamal Khashoggi walked out of consulate - Erdogan asks Riyadh
This new stance is triggering criticism from some Iran hawks and comes amid disparate statements about the administration's willingness to grant other concessions, such as preserving Iran's access to global financial markets, as the Free Beacon first reported on Monday. It hit a four-year high of $86.74 last week. This option was used to pay for Iranian oil during the sanctions imposed by the United States during Barack Obama's presidency and other European governments.
"There is growing concern that suppliers such as Saudi Arabia and Russian Federation will struggle to compensate for potential production declines from Iran and Venezuela, which has supported oil prices in today's trading session", said Abhishek Kumar, senior energy analyst at Interfax Energy in London. "State's been pushing very hard on this, they deserve a lot of credit for their efforts, so let's see what they come up with before criticizing".
"These officials are planning to announce that it's OK to give banks waivers because re-imposed sanctions on businesses are sufficient", the source explained.
"Even without sanctions also, Iran had been accepting payments in rupee", Singh said, according to PTI.More news: Fortnite: Deep Freeze Bundle Brings Battle Royale to Retail
The best value zone for the November WTI crude oil market is $72.35 to $71.27.
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