Published: Sun, August 26, 2018
Money | By Arnold Ball

China, Iran work on logistics changes ahead of sanctions

China, Iran work on logistics changes ahead of sanctions

Signs of slowing USA crude output growth and a weaker US dollar also provided some support to oil prices, said Kim Kwang-rae, commodity analyst at Samsung Futures in Seoul.

USA crude oil imports averaged 7.51 million barrels per day last week which was 1.49 million barrels per day lower than the levels of the previous week. At the beginning of August, oil prices started their longest weekly losing streak in three years. Refinery utilization rates remained unchanged last week at 98.1 percent of total capacity, the highest rates since 1999.

In June, China was the biggest foreign buyer of American crude, importing a record 15 million barrels that month.

U.S. West Texas Intermediate (WTI) crude futures CLc1 were at $67.95 per barrel at 0044 GMT, up 9 cents, or 0.1 percent, from their last settlement.

Futures in NY were little changed, headed for a weekly gain of about 3 percent.

US crude oil exports averaged 1.15 million barrels per day last week, down by 437,000 barrels per day from the previous week.

US gasoline stocks rose 1.2 million barrels, while distillate inventories increased 1.8 million barrels, EIA data showed.

Afghan president visits Ghazni after Taliban raid
The Taliban is a nationalist Islamist group unlike the IS, whose ideology calls for a caliphate that binds Muslims worldwide. The combat in the city of Ghazni confined for 5 days and more than 100 policemen were killed by the Taliban intruders.

Distillate fuels stockpiles, which include diesel and heating oil, fell by 1.3 million barrels, compared with expectations for a 207,000-barrel gain, the API data showed.

The prospect of a drop in oil exports from Iran, the third-largest producer in the Organization of the Petroleum Exporting Countries, in response to new US sanctions is also supporting the market.

Meanwhile, China, the world's biggest oil importer and Iran's biggest customer, is said to have rejected a United States request to halt purchases from the producer, dealing a blow to Trump's efforts to isolate the Middle East nation and force it into negotiations.

"The Iran issue continues to occupy traders' minds", said Greg McKenna, chief market strategist at futures brokerage AxiTrader.

According to BNP Paribas' London head of commodity markets strategy, Harry Tchilinguirian, considering the amount of oil lost from Iranian exports, it would need increases in production from other suppliers like Saudi Arabia to stabilize the oil market.

Global markets were more cautious as the ongoing trade spat between the United States and China was seen as a drag on economic growth, traders said.

Singaporean bank said on Friday that Chinese data showed a "steady decline in activities" and that "the economy is facing added headwinds due to rising trade tensions with the U.S".

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