On Friday, oil prices dropped around 1 percent ahead of the U.S. sanctions on Iran to a six-month low. The U.S. announced that they would grant Temporary jurisdictions for 8 countries which include India, South Korea and Japan to continue buying oil. Aimed to reduce any spike in prices after the sanctions come into effect on the weekend.
Brent futures fell to $72,63 or 26 cents, a 0.4 percent loss for January delivery and U.S. crude shed 1 percent or 61 cents to $63.98 a barrel.
In a conference call, U.S. Secretary of State Mike Pompeo said, without naming jurisdictions that the 28 members of the European Union would not receive one.
Iranian Oil Production
Since the U.S. pressure campaign on Iran, oil exports have been reduced from 2.7 million to 1.6 million barrels per day.
On Friday, news media reported that Iran were not concerned over the imposition of sanctions.
World oil production has put prices under pressure as production has risen significantly during the last 2 months. Data on Friday from Russian Energy Ministry showed that they pumped 11.41 million barrels per day, a 30-year high in October.
U.S. Increases Output
U.S. crude production is above 11 million barrels per day, challenging the Russians for their title as top producer, with the Permian Basin the biggest American oil producer.
OPEC oil production in October, is at its highest since 2016 and have boosted production adding 390,000 bpd to 33.31 million bpd.
Director of market research at Tradition Energy in Stamford, Connecticut, Gene McGillian said that it looks like the worries about the loss of Iranian barrels and tightening supplies have dried up.
World equity markets rallied with hopes that the U.S. and China were making progress on trade relations, which lent support to crude on Friday. Stock markets have been rattled by concerns of a trade war between the U.S. and China which has weighed on crude prices.
Gasoline futures slipped to $1.7083 or 0.5 percent a gallon.
That’s not all………….