Thursday, 21 June, 2018

Oil ebbs from multi-year highs on surge in USA drilling

Oil ebbs from multi-year highs on surge in USA drilling Oil ebbs from multi-year highs on surge in USA drilling
Nellie Chapman | 15 May, 2018, 02:37

But its oil minister said on Thursday that Trump's decision to quit the pact would not affect Tehran's exports.

Speaking on "Fox News Sunday", Pompeo said that the United States was not aiming at Europe when it withdrew from the Iran nuclear deal last week.

"There are worries that Iran's oil exports could fall by about 1 million bpd from current levels", said Tomomichi Akuta, senior economist at Mitsubishi UFJ Research and Consulting in Tokyo.

It's not often that an OPEC producer accuses the US of driving up oil prices.

The People's Republic stands to benefit if it can use its leverage as the world's largest importer of crude by insisting that its oil purchases from Iran be priced in yuan.

A Saudi energy ministry official said that Saudi Arabia "will work with major producers and consumers within and outside OPEC to limit the impact of any supply shortages".

Chilean state-owned refiner ENAP has purchased 140,000 tons of Iranian crude for May loading in a rare move, according to Platts.

The crude oil prices went down during the last days of the week, although the commodity remains close to its peak reached in the previous session, after the likelihood of U.S. sanctions against one of the major OPEC producers Iran may further tighten the market.

Read: Is Egypt coming down hard on Careem and Uber?

Global benchmark Brent LCOc1 gained $1.11 to settle at $78.23 a barrel. Additionally, global inventories have tightened amid strong demand from Asia.

US West Texas Intermediate (WTI) crude futures were down 15 US cents, or 0.2%, at US$71.21 a barrel after hitting a November 2014 high of US$71.89 per barrel on Thursday.

Washington has given European firms doing business in Iran up to six months to wind up investments or risk US sanctions and they are also forbidden from signing any new contracts with Iran.

The U.S. withdrawal from the Iran deal has upset Washington's European allies, cast uncertainty over global oil supplies and raised the risk of conflict in the Middle East. Meanwhile, the USA production reached a new record last week, rising to 10.7 million barrels per day.

Also supportive to prices was data from market intelligence firm Genscape showing that inventories at Cushing, Oklahoma, the delivery point for USA crude futures, fell more than 400,000 barrels in the week to May 11, according to traders who saw the data.

This would make the United States the world's largest producer, ahead of both Russian Federation and Saudi Arabia.