Oil falls on slowing Chinese demand, U.S.-China trade spat

Roman Schwartz
August 9, 2018

Iran's oil exports dropped by 7 percent to 2.32 million bpd in July-their lowest level in four months-as South Korea and Europe are slashing imports ahead of the return of the US sanctions on Tehran, data from S&P Global Platts showed on Tuesday. The commercial crude inventory is about 1% below the five-year average for this time of year.

On the 4 hour chart, crude oil is crossing above a solid resistance level of $69.45.

Looking ahead, the prices may find some temporary support from the global supply concerns following the renewed USA sanctions on Iran. A second round is scheduled to begin in November.

"Without the extra Saudi oil we had in June, it's hard to crunch the numbers and get a lower price going into the end of the year", said John Kilduff of Again Capital.

ANALYST'S TAKE: "Looking at the rhetorical battle between the United States and China recently, it may appear that finding a clue to resolve (the trade war) is impossible", said Lee Seunghoon, an analyst at Meritz Securities Co.in Seoul, South Korea.

Under the arrangement, Iran's oil payments were deposited into accounts in oil-importing countries and used by Tehran to buy goods.

Gasoline exports edged up 75,000 b/d to 588,000 b/d, while distillate exports slipped 51,000 b/d to 1.23 million b/d.

Diego Godin REJECTS chance to make late move to Manchester United
But United appear to still be trying to bring in a top defender with attention suddenly turning to Godin. Mourinho is said to be keen to add an experienced centre-half to his ranks in time for the new season.

Total estimated export volumes on Aframaxes, Suezmaxes and VLCCs from Iranian ports in July fell by 7% to 2.32 million b/d from 2.49 million b/d in June, according to data from S&P Global Platts trade flow software cFlow.

Spot Brent crude oil futures were at $74.08 per barrel at 0624 GMT on Tuesday, up 33 cents, or 0.4 percent, from their last close. At the end of the week, WTI settled at 68.49 US dollars, while Brent settled at 73.21 dollars. Its previous estimate was at 10.79 million barrels per day.

Refinery crude runs rose by 118,000 barrels per day, EIA data showed.

USA gasoline futures fell 3.8 percent to $2.025 per gallon.

He noted that: "Anyone doing business with Iran will NOT be doing business with the United States".

Here is a look at how share prices for two blue-chip stocks and two exchange-traded funds reacted to this latest report. A trade spat between the U.S. and China has kept oil from rebounding from a seven per cent plunge last month.

"This "Big 3" coordinated oil market management in response to a move out of the $70-80/b Brent range does provide some gravitational pull for prices to move back into this range, as was demonstrated last month by the Saudi announcement that it was prepared to adjust exports to meet rapidly changing market condition".

Other reports by

Discuss This Article

FOLLOW OUR NEWSPAPER