Oil falls as Iran has increased supply according to Reuters

© Reuters. FILE PHOTO: Crude oil sticker on the wall of a storage tank in the Permian Basin in Mentone, Loving County, Texas, U.S. November 22, 2019. REUTERS / Angus Mordant

MELBOURNE (Reuters) – Oil prices fell slightly on Tuesday on the latest progress in final talks to revive the 2015 Iran nuclear accord, which would clear the way to boost the country’s crude exports. in a tight market.

Futures contracts fell 14 cents, or 0.1%, to $96.51 a barrel at 0:404 GMT, up 1.8% from the previous session.

U.S. West Texas Intermediate (WTI) crude oil futures fell 16 cents, or 0.2%, to $90.60 a barrel, after gaining 2% in the previous session.

“The specter of a US-Iran nuclear deal continues to hover over the market,” said ANZ Research analysts.

The European Union late Monday issued a “final” text to reinstate the 2015 Iran nuclear deal, pending approval from Washington and Tehran. A senior EU official said a final decision on the proposal was expected within “very, very few weeks”.

Commonwealth Bank analyst Vivek Dhar said: “While the details around the timing of the resumption of Iranian oil exports remain uncertain even if the accord is restored, Iran certainly has the ability to increase exports. relatively quickly,” said Commonwealth Bank analyst Vivek Dhar.

He said Iran could boost its oil exports by 1 million to 1.5 million barrels per day, or up to 1.5% of global supply, in six months.

“The resurgence of the 2015 nuclear accord is likely to see oil prices plummet as markets may not believe an agreement will be reached,” Dhar said.

However, signs that demand may not have suffered as much decline as fears are holding a floor below the current market, following stronger-than-expected trade data from China over the weekend and surprising acceleration in US job growth in July.

The oil market has remained under pressure recently due to fears of a global recession, with Brent crude’s biggest weekly drop last week.

China, the world’s largest importer, imported 8.79 million bpd of crude in July, 9.5% lower than a year earlier but up from June’s import volume. , according to Chinese customs data.

Traders will also keep an eye on weekly US oil inventory data, first from the American Petroleum Institute on Tuesday and then from the Energy Information Administration on Wednesday.

Five analysts polled by Reuters expect crude inventories to fall by about 400,000 barrels and gasoline stocks to fall by about 400,000 barrels in the week to August 5, while distillate inventories, which include diesel, are expected to fall. and jet fuel, unchanged.

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