Photo: Ali Mohammadi, Bloomberg
Oil fell to a seven-month low as fears eased that US sanctions on Iran will suppress supplies worldwide.
Crude oil settled in New York on Monday after rising earlier due to American sanctions on producer No. 3 OPEC was officially kicked. The Trump administration gives relief to China and seven other big buyers so they can continue to buy some Iranian crude. Meanwhile, expanding domestic inventories reduced concerns about tightening global supply.
"The reality of the relief will be some Iranian oil left on the market, but that will still be a number that will disappear the market," said John Kilduff, a partner at New York-based New Capital LLC hedge fund. .
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Oil slumped from four-year highs last month when speculation grew that Washington would provide relief to reduce gasoline prices ahead of US midterm elections, while other producers in the Organization of Petroleum Exporting Countries pledged to offset the supply gap. Meanwhile, a trade war between the world's two largest economies sparked fears that fuel demand will suffer even when President Donald Trump said he wanted to reach an agreement with China.
At the main pipeline center at Cushing, Oklahoma, crude stockpiles probably rose 2.1 million barrels last week, according to estimates compiled by Bloomberg.
West Texas Intermediate crude for December delivery lost 4 cents to end the session at $ 63.10 a barrel on the New York Mercantile Exchange. Futures fell 6.6 percent last week. The total volume traded Monday is around 10 percent below the 100-day average.
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Brent futures for January settlement added 34 cents to settle at $ 73.17 on the London-based ICE Futures Europe exchange. Global benchmark crude traded at $ 9.96 premium to WTI for the same month.
US Secretary of State Mike Pompeo said the release would only allow the purchase of temporary Iranian crude. Iran can change its behavior or see its economic collapse, he said.
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