US's Bolton says more sanctions likely on Iran

Forty years of American hostility’ Iran releases video responding to new US sanctions

Forty years of American hostility’ Iran releases video responding to new US sanctions

The Indian government on Friday welcomed the decision by the United States administration to exempt Indian purchase of crude oil from Iran that will shield India from sanctions from the US.

India is also Iran's second-biggest oil customer and will be one of the most exposed to a forced drop in supply because of its relative proximity to Iran.

OPEC and its oil market allies were also concerned that rising prices would shrink demand for oil.

Crude has tumbled nearly 20% since touching a four-year high last month as bearish supply signals around the globe crowded out concerns about disrupted exports from Iran and Venezuela.

Iraq, the second-largest producer within the Organization of the Petroleum Exporting Countries (OPEC) behind Saudi Arabia, is targeting production capacity of 5 million bpd in 2019, up from 4.6 million bpd now, Oil Minister Thamer Ghadhban said on Tuesday.

Even with USA sanctions on Iranian oil in place, the perception among investors is that there is more than enough supply to meet demand, as reflected by the front-month January Brent futures contract trading at a discount to February.

The record United States production has been a moderating factor of oil prices, although oil got a bump on Thursday after record Chinese crude imports eased concerns that a slowdown in the world's No.2 economy could stoke an emerging fuel glut.

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The U.S. "sincerely hopes" accidents do not occur, he said, but he noted that an Iranian tanker was involved in an accident in the East China Sea in January that resulted in the loss of the ship and a massive oil spill. That's another reason the producers agreed to increase output earlier this year, partly reversing a policy of limiting supply.

The first round of USA sanctions, which included cars, carpets, metals trading and access to the United States dollar, entered into force in August.

Oil prices ran up about $7 a barrel in the month before Trump announced he was abandoning a nuclear accord with Iran and restoring sanctions on the Islamic Republic.

U.S. West Texas Intermediate (WTI) crude CLc1 was at $61.84, down 37 cents, or 0.6 percent. The main target was Iran's energy sector, the core of its economy.

"Waivers are likely to be more extensive than the market expected", energy consultancy FGE said, estimating that waivers overall would allow 1.2 to 1.7 million bpd of exports.

Those fears have since eased, but a committee of OPEC members and allied countries recently warned that producers may begin cutting output once again.

Trump said during a press conference on Wednesday that his administration granted the temporary waivers in order to stop the price of oil from going up. "We have calibrated this very well".

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