Oil Exports in Iran Drop More Thanks to Trump Sanctions

Oil dips but bounces off low on hopes for China stimulus

Despite US sanctions, India to continue buying Iranian oil

Iran's Oil Minister this week brushed off "nonsense" claims by Saudi Crown Prince Mohammed bin Salman that Saudi Arabia can replace Iranian oil.

The release of the photographs and video raises pressure on Saudi Arabia a week after Mr Khashoggi disappeared during a visit to the consulate.

"Actually the request that America made to Saudi Arabia and other OPEC countries is to be sure that if there is any loss of supply from Iran, that we will supply that".

Total crude output lost in the last three days from shut-ins amounted to 1.7 million barrels, according to BSEE data.

Many analysts said they expected Iranian exports to drop by around 1 million barrels per day.

Reacting to the remarks, the veteran Iranian minister said, "it seems that such remarks were made under United States pressure on Saudi authorities; otherwise in reality, neither Saudis nor any other countries could replace Iran's exports".

At Russia Energy Week in Moscow last week, both Saudi and Russian energy ministers said they see rising geopolitical risk as driving the recent oil price increase at a time when there is sufficient supply in the market. While Saudi Arabia accounts for the lion's share of OPEC production, some analysts are skeptical it has enough spare capacity to fill the gap while maintaining adequate reserves.

Washington is also asking buyers of Iranian oil to slash imports to zero to force Tehran to negotiate a new nuclear agreement. A second round of sanctions targeting Iran's oil sector is due to go into effect on November 5. Crude oil price increases could also slow stellar USA economic growth, admittedly a bragging point and point of vulnerability for the Trump White House as the 2020 presidential election cycle nears.

Oil prices have extended a rally on expectations the sanctions will test the Organization of the Petroleum Exporting Countries and other producers.

USA sanctions against Tehran are widely expected to have an immediate impact on Iran's oil exports, although the estimates of exactly how much of the country's oil could disappear from November 4 vary widely.

But prices bounced off session lows as investors bet that Sunday's move by China's central bank to slash lenders' reserve requirements would lift economic growth and spur oil imports.

During his week-long trip from October 10-17, US Special Representative for Iran Brian Hook will engage "allies and partners on our shared" need to counter the entirety of the Iranian regime's destructive behaviour in the Middle East, and in their own neighbourhoods, the State Department said yesterday.

"A source said: "It is still early to say how India will settle its trade with Iran", and said it may consider paying for the oil with the rupee currency". "This is an obvious fact".

Oil prices were moving higher on Tuesday, as more evidence emerged that crude exports from Iran, OPEC's third-largest producer, are declining ahead of the USA sanctions against the country, kicking in from November 4.

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