Indian Oil buys U.S. crude to part replace Iran cargoes

Indian Oil buys U.S. crude to part replace Iran cargoes

Indian Oil buys U.S. crude to part replace Iran cargoes

At 7:25 a.m. EDT on Thursday, WTI Crude was trading down 0.12 percent at $66.86, while Brent Crude was up 0.17 percent at $72.40, holding steady after a 3-percent plunge yesterday, when China and the United States traded a new round of tariffs and counter-tariffs on US$16 billion worth of each others' imports, with China slapping tariffs on 333 USA goods, including petroleum products.

"We think India will continue to buy United States oil given the strength in USA production and the Indian market can emerge as a reliable buyer of U.S. oil", said Sri Paravaikkarasu, head of East of Suez Oil at consultancy FGE.

Brent crude futures were up 14 cents at $72.42 barrel by 0855 GMT, after having dropped by more than 3 percent on Wednesday.

Markets remained supported by the introduction on Tuesday of new USA sanctions against Iran, which initially target Iran's purchases of dollars - in which oil is traded - as well as metals trading, coal, industrial software and its automotive sector.

"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".

The ratcheting up of trade tensions between the USA and China could also help oil buyers in India, the world's third-biggest crude consumer, according to Interfax's Kumar.

The company will receive one very large crude carrier (VLCC) of USA oil every month in November, December and January.

"It's certainly going to impact on movement between the US and China, making it less efficient, meaning pressure on prices here", said Andrew Lipow, president of Lipow Oil Associates.

More news: Scattered protests in Iran as US sanctions loom

Global stock markets were mixed Thursday with European stocks trading lower after Chinese markets finished with sharp gains.

Analysts expect Iranian exports to drop by anything between 500,000 and 1 million b/d after full U.S. sanctions are re-imposed on November 5.

US West Texas Intermediate (WTI) crude futures were up 20 cents, or 0.3 percent, at $69.21 barrel.

Oil prices rose on Tuesday after USA sanctions on Iranian goods went into effect, intensifying concerns that sanctions on Iranian oil, expected in November, could cause supply shortages. A second tranche coming into effect on November 5 will cover Iran's oil sector.

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".

Official US fuel storage data is due to be released later on Wednesday by the Energy Information Administration (EIA).

Later on Friday, Baker Hughes will publish its weekly report on the United States oil rig count.

Iran is the third-largest producer among the members of the Organization of the Petroleum Exporting Countries (Opec). Gasoline inventories increased by 2.9 million barrels, the data show. An earlier report from industry group the American Petroleum Institute had suggested inventories fell by 6 million barrels.

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