Oil prices ease as trade row clouds demand outlook

Oil prices ease as trade row clouds demand outlook

Oil prices ease as trade row clouds demand outlook

U.S. West Texas Intermediate (WTI) futures rose 28 cents to $69.27 a barrel after posting a drop of 20 cents earlier in the trading session.

Oil in NY has topped $71 a barrel this month and Brent hit $80 as Iranian sanctions threaten to further cut into available supply, overshadowing concerns over U.S.

Bloomberg US news agency reported on Sunday that Iran's oil exports had declined almost to one third since US President Donald Trump announced the reimposition of sanctions on Tehran following his withdrawal from the nuclear weapons deal in May.

Benchmark Brent crude already is nearing $80 a barrel and some believe it may go even higher.

Crude has mostly stayed below $70 a barrel since mid-July as a trade dispute between the US and China threaten global economic growth.

"The market's expectation of shortages has cooled after data from last week showed increases in supplies, while investors have lowered the outlook for oil demand", said Wang Xiao, head of crude research with Guotai Junan Futures.

But supporting crude futures were potential supply cuts from US sanctions on Iran.

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Prices rose on Tuesday amid media reports that Saudi Arabia, the world's largest oil exporter, was comfortable with prices climbing above $80 a barrel.

The tariffs are likely to limit economic activity in both China and the U.S. and that should lower oil demand growth as less fuel is consumed to move goods for trade.

Oil prices were little changed on Monday as the market weighed deepening trade tension between the USA and China that is expected to dent global crude demand and potential supply tightening due to Iran sanctions.

Oil output from seven major US shale formations is expected to rise by 79,000 bpd to 7.6 million bpd in October, the US Energy Information Administration said on Monday.

U.S. Energy Secretary Rick Perry told Reuters at the weekend that he did not expect any price spikes and that Saudi Arabia, the U.S and Russian Federation could between them raise global output in the next 18 months.

In a meeting with Secretary-General Mohammad Barkindo, a senior Iranian diplomat urged him to keep the group out of politics.

Prices pared gains in post-settlement trade after data from industry group the American Petroleum Institute showed USA crude inventories rose by 1.2 million barrels in the week to September 14 to 397.1 million, compared with analysts' expectations for a decrease of 2.7 million barrels.

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