Prices of oil stabilized.
The Toronto Stock Exchange's S&P/TSX Composite index was down 13.13 points, or 0.08 per cent, at 16,273.17 in early trading.
Crude oil continues to rise bullish as traders remained anxious over revived US sanctions against major crude exporter Iran. Meanwhile, the production of Syncrude Canada's offline on its sands facility is impacting the market. Global benchmark Brent crude was trading at $74.44 a barrel at 12:32 p.m. EDT (1644 GMT). Traders, crude oil seems to form a candlestick pattern "three white soldiers".
Our outlook for crude oil remains neutral.
The sanctions are already brewing a potential confrontation between the United States and Iran as Tehran has threatened to block the Strait of Hormuz, an important sea route through which tankers ship more than 30 per cent of crude oil to the worldwide market, in retaliation to the sanctions.
US West Texas Intermediate (WTI) crude futures were up 20 cents, or 0.3 percent, at $69.21 barrel. "The US decision to pull out of the Joint Comprehensive Plan of Action has been known since May, so the market has had time to price in reduced Iranian output - probably of about one million barrel per day (bpd) - into oil prices", analysts at Capital Economics said. On the other hand, a breakout of $69.60 (10-day sma) could aim for $70.56 (high Aug.6) and then $71.39 (high Jul.30). We will monitor this week's figures for another increase in inventory levels which could see oil prices move lower. US refineries produced about 9.9 million barrels of gasoline a day last week, down by about 600,000 barrels compared to the prior week.
Anas Alhajji, an energy economist based in Dallas, Texas, told Xinhua that "Unlike the past, USA weekly crude oil inventories have become extremely sensitive to U.S.net imports, making short term oil prices more volatile".
To recap this week's events, on Tuesday, the US renewed sanctions against Iran that are expected to eventually remove about 1 million barrels per day of crude oil from the market. Iran is the third-largest producer in oil cartel Opec.
"You can not order 2 million barrels like ordering a coffee somewhere", Beat Wittmann, a partner at financial consultancy Porta Advisors, told CNBC recently.
Refineries were running at 96.6% of capacity, with daily input averaging 17.6 million barrels a day, about 118,000 more than the previous week's average.
This would be nearly triple the 119,000 bpd India imported from the United States in July, and well above the 190,000 bpd for November past year, the previous record for a month.
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