However, Chinese trade data released Thursday showed the country's oil imports rose to an all-time high at 9.61 million bpd in October, Reuters reported. Oil peaked in October on concerns that USA sanctions on Iran that came into force this week would deprive the oil market of substantial volumes of crude, draining inventories and bringing shortages in some regions. From then, to pleading for a waiver by accepting U.S. terms to reduce oil imports from Iran by a third before sanctions came into place on November 5, reveals a steady succumbing to United States pressure. Companies that monitor Iran's shipments are already seeing a drop in tanker activity this month. Fund managers have started to establish short positions betting on further price falls (tmsnrt.rs/2P8LQ1S).
With the U.S. granting eight countries (including Turkey, but though to include India, Japan and South Korea), Iranian exports will end up higher than previously though for the next six months. The oil import bill for the current financial year, 2018-19, is expected to rise to $125 billion, i.e., by 42 per cent.
"America wanted to cut to zero Iran's oil sales ... but we will continue to sell our oil ... to break sanctions", Rouhani said.
He said the department had evidence that Iranian vessels are trying to evade US sanctions by disabling location transponders used to prevent collisions - with the goal of making Iran's oil exports harder to track.
Japan and South Korea, close US allies, had toed the Washington sanctions line and stopped buying crude from Iran. Washington has granted exemptions to Iran's biggest buyers, allowing them to buy limited amounts of oil for at least another six months.
Subdued economic data from the world's second-largest economy and voracious consumer of crude - China - is a matter of concern on the demand side at a time when supplies are picking up rapidly.
"Any serious discussion will be toward the December meeting", this source said. As Pompeo referred to the exemptions for the eight countries as "temporary", surely negotiations continue between the United States and India on how to satisfy Washington's sanctions aims and India's strategic necessities.
"It will be a hard period but Iran's economy will withstand it for various reasons", a second diplomat told Reuters, "including (the fact of) Russian Federation being under (US and EU) sanctions, Saudi Arabia having its own financial and political issues, and (trade war) between China and the United States".
The previous sanctions on Iran, imposed by Trump's predecessor Barack Obama, were supported by the UN Security Council and the European Union. It is also considered a gateway to golden opportunities for trade by India, Iran and Afghanistan with central Asian countries besides ramping up trade among the three countries after Pakistan denied transit access to India. The outlook for the first half of 2019 is seen subdued as the supply surge is unlikely to be matched by demand growth.
On Monday, the United States restored sanctions that target Iran's oil exports, as well its banking and transport sectors.
Brent crude closed at US$72.13 a barrel on Tuesday, down 1.4 per cent from the close on Nov 5, and down 15 per cent from the four-year high of US$84.79 reached on Oct 3.
In the meantime, the oil market can probably cross Iran off its list of worries, but pencil it back for sometime around April next year.
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