Traders Looking to Establish New Balance Points after China Tariffs

Traders Looking to Establish New Balance Points after China Tariffs

Other than the four key importers, the European Union has said it will not enforce USA sanctions which are to be imposed on Iran's oil and banking sectors on November 4. A second tranche coming into effect on November 5 will cover Iran's oil sector.

Brent and West Intermediate Texas crudes traded generally sideways last week, despite the pronounced weakness at the end of the week. "That said, the sanctions may heighten geopolitical tensions in the Middle East, which are likely to weigh on local financial markets", they said.

Flows from Iran to China and India - its two key customers - remained high, but exports to South Korea, Europe fell steadily as these buyers start to elsewhere.

Oil prices rose as the United States reintroduced sanctions against major crude exporter Iran, tightening global markets.

Iran's oil exports have now fallen for three successive months as the country braces itself for the re-imposition of sanctions by the US.

The concerns over possible supply disruptions in Iran come at a time when analysts warn that a global heatwave could increase oil demand.

The oil shipments into the world's biggest importer of crude came in at 36.02 million tons last month, or almost 8.48 million barrels per day, higher from 8.18 million barrels per day a year ago, and just over June's 8.36 million barrels per day, according to the data from the General Administration of Customs.

"Oil has barely made its way above $69 and is struggling to gain further, trading in a tight range, as both the upward and downward elements co-exist, pulling prices from opposite directions", Kim Kwangrae, a commodities analyst at Samsung Futures Inc., said by phone from Seoul.

Brent crude futures were at $74.61 per barrel, down 4 cents from their last close.

Crude prices settled slightly lower on Thursday, extending the previous session's losses as the escalating China-U.S. trade dispute casts doubt over the outlook for oil demand.

Crude oil prices were moving between small gains and losses ahead of the start of trading in NY.

Crude oil prices lost 3 percent in Wednesday trading after the U.S. Energy Information Administration reported crude oil inventories dropped less than expected. That compares to its previous year's spot purchases of 6.6 million barrels from the shale producer.

The August total is also likely to be just above the 9.65 million barrels imported over the first seven months, showing the scale of acceleration in India's imports of USA crude.

International Olympic Committee will buy 2 million barrels of Mars oil in November, a combination cargo containing 1 million barrels each of Eagle Ford and Mars in December and 2 million barrels of Louisiana Light Sweet (LLS) in January, Sharma said.

Inventories at Cushing, Oklahoma, the NYMEX crude futures delivery and pricing point, tightened further, falling 590,000 barrels to 21.8 million barrels, the EIA data showed. "They are battling with poorer margins due to government tax interventions and higher oil prices", Commerzbank said in a note.