Oil in London extended losses for a third day on signs that the potential impact of impending U.S. sanctions on Iranian supplies may be mitigated.
Brent futures fell as much as 1.1 percent to below $84 a barrel, after retreating 2.5 percent over the past two sessions. Saudi Arabia can tap its spare production capacity immediately to offset any declines in Iranian crude exports, the kingdom’s crown prince said in an interview. Meanwhile, the U.S. was said to be in talks with countries that want to continue buying from the Persian Gulf state after American sanctions are reimposed Nov. 4.
Oil has rallied to trade near four-year highs on concerns that the looming U.S. restrictions on the Islamic republic will squeeze shipments and spur a global crunch at a time when supplies are already being disrupted in Venezuela and Libya. Investors remain concerned the Organization of Petroleum Exporting Countries and its allies aren’t raising output quickly enough and that they may not have the capacity to fully cover disappearing volumes.
Brent for December settlement fell as much as 96 cents to $83.20 a barrel on the London-based ICE Futures Europe exchange, and was at $83.44 at 2:32 p.m. in Singapore. The contract slipped 0.5 percent to $84.16 on Friday. The global benchmark crude traded at a $9.70 premium to U.S. West Texas Intermediate for the same month.
WTI for November delivery traded at $73.79 a barrel on the New York Mercantile Exchange, down 0.7 percent. The contract added 1 cent to $74.34 on Friday. Total volume traded was about 7 percent above the 100-day average.
Source : Bloomberg