Published: Thu, October 18, 2018
Money | By Arnold Ball

Oil steady as Saudi tensions balance demand outlook

Oil steady as Saudi tensions balance demand outlook

With last week's increase, US crude stockpiles have risen for four straight weeks now.

Those dealing with ship insurance and oil-ports are also cautious about handling Iranian oil.

USA light crude oil CLc1 was up 10 cents at $72.02.

'You cannot keep the price low with slogans and intimidation, ' considered Zanganeh.

New Dehli: Saudi Arabia Monday committed to meeting India's rising oil demand and said it is keen to invest in fuel retailing and petrochemical business in the world's fastest-growing energy consumer. The U.S. -imposed sanctions go into effect November 4 and prohibit countries from buying Iranian crude exports.

Reiterating India's stand, Pradhan told reporters here on the sidelines of the 3rd India Energy Forum that the current surge in global crude oil prices was more a result of the market sentiments being hit by geo-political factors which includes Iran and said there were no issues of availability. "Trump thinks he can bring the oil prices down by bullying", Zanganeh said on the sidelines of the 4th Iranian Petroleum and Energy Club Congress (IPEC 2018) in Tehran on Tuesday. US President Donald Trump had in May withdrawn from the 2015 nuclear accord with Iran, re-imposing economic sanctions against the nation. The global benchmark, which hit a more than two-week low late last week as equity markets dropped, is trading around $5 below a four-year high of $86.74 marked on October 3. Trump dispatched Secretary of State Mike Pompeo to Saudi Arabia to meet with King Salman.

International Monetary Fund predicts 7.3% growth rate for India in current fiscal year
It left 2018 growth forecasts for the two countries unchanged at 2.9 per cent for the United States and 6.6 per cent for China . The fund shaved 0.1 percentage point from America's expected GDP this year and 0.4 percentage points from growth through 2019.

Crude has increased about 20 percent this year as concerns linger that demand may outstrip supply with American sanctions on Iran set to be implemented early next month.

Inventories rose sharply even as USA crude production slipped 300,000 bpd to 10.9 million bpd last week, which analysts attributed to the effects of offshore facilities closing temporarily for Hurricane Michael. The 11.21 million barrels places the country in second place of the most prolific oil producers in the world, behind the United States, who overtook both Saudi Arabia and Russian Federation earlier this year, according to EIA data as cited by CNN.

"The looming Iranian supply disruption and the conflict between the USA and Saudi Arabia are pushing traders to take a cautious stance at the moment", Will Yun, a commodities analyst at Hyundai Futures Corp., said by phone from Seoul.

"When oil companies enter into annual term contracts for buying crude oil, there are two components mentioned - firm supplies and optional supplies".

India, the world's third-biggest oil importer, is facing record high retail prices as global crude rate soared and rupee value dipped.

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