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Bloomberg
Oil in London traded near a two-month high as Iranian crude and condensate exports fell to their lowest level in more than two years, showcasing concerns over a potential supply shortfall once US sanctions on the Middle East nation’s shipments start in November.
Brent futures gained as much as 0.7 percent. Iran shipped just under 2.1 million barrels a day of crude and condensates in August, the lowest since March 2016, ship-tracking data compiled by Bloomberg show. Still, Russia kept pumping oil near post-Soviet records last month, and Saudi Arabia boosted output to more than 10.42 million barrels a day.
Oil rose last month as supply concerns intensify before renewed American sanctions aimed at curbing Iranian export kick in, adding to
concerns over Venezuela’s plunging production.
Traders and analysts are increasingly scrutinising Saudi Arabia and Russia’s output data for signs they will fill potential gaps in
supply.
“Underpinning the prevailing bullish sentiment is the increasingly supportive supply outlook,†PVM Oil Associates analyst Stephen Brennock wrote in a report. “Much of this owed to the downswing in Iranian oil shipments.â€
Brent futures for November settlement traded 45 cents higher at $78.09 a barrel on the ICE Futures Europe exchange in London. With the expiry of the October contract, the Brent futures curve is now fully backwardated — with later contracts trading lower than nearer ones. This is an indication of tight supply.
West Texas Intermediate for October delivery added 9 cents to $69.89 a barrel on the New York Mercantile Exchange. The contract gained 1.6 percent last week.
The Brent contract traded at an $8.58 premium to WTI for the same month, the widest since June.
The US marker is lagging Brent as American producers keep pumping crude at record levels near 11 million barrels a day. Saudi Arabia produced nearly 140,000 barrels more in August from a month earlier, two delegates from the Organization of Petroleum Exporting Countries said.