Oil steadies at $72-$73 band as Iran sanctions kick in

Wednesday, 07 Nov, 2018

The Obama administration had lifted sanctions on entities dealing with those sectors as part of the 2015 nuclear deal, which exchanged sanctions relief for a rollback in Iran's nuclear program.

The devil lies in the details on how much respite India and seven others have got from the United States to import Iranian oil.

"America wanted to cut to zero Iran's oil sales... but we will continue to sell our oil... to break sanctions", he said.

The price pressure on oil has scared off financial traders.

USA officials have said the aim of the sanctions is eventually to stop all Iran's oil exports.

A source at a Japanese refiner said the firm had begun considering resuming Iran oil purchases, though details have not been set yet. That should have driven oil prices up due to concerns over lack of supply. "But I don't want to do that", he said.

As you can imagine, more people are reading The Jerusalem Post than ever before. "The US - and not Iran - is isolated", Zarif said in a tweet.

Iran's crude exports could fall to little more than 1-million barrels per day (bpd) in November, roughly a third of their mid-2018 peak.

Joint output from the world's top producers - Russia, the USA and Saudi Arabia - in October rose above 33 million bpd for the first time, up 10 million bpd since 2010.

Last time the arrangement was that India will pay for 45 per cent of its oil purchase in rupee and the rest in euros.

He called on Iran's leaders to immediately give up support for terrorism, stop proliferating ballistic missiles, end destructive regional meddling and abandon their nuclear ambitions in order to escape the crushing sanctions.

Iran on Monday (Nov 5) urged the United Nations to hold the United States accountable for re-imposing sanctions on Tehran, branding the measures illegal and in violation of a Security Council resolution.

Iranian President Hassan Rohani said even without the waivers Iran would still be able to sell its oil, semi-official Tasnim news agency reported.

"We continue to believe that the Iran nuclear deal makes the world a safer place", British Prime Minister Theresa May's spokesman said. Iran can only use this money for humanitarian trade or bilateral non-sanctioned goods, the Secretary of State asserted.

"Iranian exports show a decline of more than 1 million barrels per day (bpd) as of October from May", said Edward Bell of Emirates NBD bank.

European powers that continue to back the nuclear deal said they opposed the reapplication of sanctions and major oil buyer China said it regretted the move.

"Further, its negotiators failed to secure any restrictions on Iran's other destabilising activities, including the regime's ballistic missile development and proliferation", he told a NY audience.

The Trump administration's intensifying effort to strangle Iran's economy, critics say, marks a gamble as it divides the USA from traditional allies in Europe and casts uncertainty into oil markets.

"It will be hard for Iran to maximise exports when virtually all trade in oil is cleared in United States dollars, putting global oil companies, many national oil companies, traders and banks off limits", said Homayoun Falakshahi, analyst at Wood Mackenzie. "Yesterday, Saddam was in front us, today Trump is front of us".

Iran and the P5+1, the United Nations Security Council's five permanent members -the U.S., the UK, France, Russia, and China - plus Germany, reached the Iran nuclear deal in July 2015.