Oil steady as growth in U.S. supplies faces lower Iran exports

Oil prices were little changed on Tuesday as concerns about tightening global supplies ahead of U.S. sanctions on Iran faced higher U.S. shale production and inventories.
The disappearance of a Saudi Arabian journalist Jamal Khashoggi in Turkey has also strained U.S.-Saudi ties and provoked international outcry and fears that supplies from the world’s top crude exporter may be affected.
“The focus within the oil trade during the next couple of weeks is likely to be on Iran and Saudi Arabia,” Jim Ritterbusch, president of Ritterbusch and Associates, said in a note.
Brent crude rose 18 cents to $80.96 a barrel by 11:57 a.m. EDT (1557 GMT), while West Texas Intermediate (WTI) crude was flat at $71.78 a barrel.
“In the absence of upward pull from the products or the Brent market, WTI will have difficulty advancing and additional weakening in the WTI curve would appear likely given recent stock builds at Cushing,” Ritterbusch added.
Inventories at the Cushing, Oklahoma hub, the delivery point for WTI, have risen for three straight weeks. Overall, U.S. crude stockpiles were forecast to have risen last week for the fourth straight week, by about 1.1 million barrels, according to a Reuters poll ahead of weekly inventory reports.
Data from the American Petroleum Institute (API) is due at 4:30 p.m. EDT (2030 GMT) while the U.S. Department of Energy will release official data at 10:30 a.m. EDT (1430 GMT) on Wednesday.
In addition, weak U.S. gasoline margins and growing U.S. shale output could cap gains, market participants said.
“The weakening crude spreads almost globally in the face of Iran sanctions is likely generating some concern on how strong market really is and if it’s ready to rally more,” said Scott Shelton, energy futures broker with ICAP in Durham, North Carolina.
Front-month Brent crude futures traded at the lowest premium in over a month to futures for delivery one year from now. Meanwhile, front-month U.S. crude futures traded near the smallest premium to the 12th month in about 10 months.
Oil production from seven major U.S. shale basins is expected to rise by 98,000 barrels per day (bpd) in November to a record of 7.71 million bpd, the U.S. Energy Information Administration (EIA) said.
Still, reports that Iranian exports of crude oil may be falling faster than expected ahead of new U.S. sanctions on Tehran from Nov. 4 lent support.
In the first two weeks of October, Iran exported close to 1.5 million bpd of crude to countries including India, China and Turkey, some industry sources suggest.
That is a sharp drop from 2.5 million bpd in April before U.S. President Donald Trump withdrew from a nuclear deal with Iran in May and ordered the re-imposition of sanctions.
OPEC Secretary-General Mohammad Barkindo said oil markets were currently adequately supplied and balanced, but urged oil producing companies to increase capacities and invest more to meet future demand as spare oil capacity shrinks worldwide.
(Agency)
Author Profile
Monika Walker is a senior journalist specializing in regional and international politics, offering in-depth analysis on governance, diplomacy, and key global developments. With a degree in International Journalism, she is dedicated to amplifying underrepresented voices through factual reporting. She also covers world news across every genre, providing readers with balanced and timely insights that connect the Caribbean to global conversations.
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