Published: Thu, September 27, 2018
Markets | By Josh Butler

Russian minister accuses USA of destabilising oil market

Russian minister accuses USA of destabilising oil market

Brent crude futures were up 16 cents at $79.19 per barrel at 0658 GMT, after rising 1.3 percent in the previous session.

This meeting was held while new sanctions against Tehran scheduled in early November should be a fall in iranian exports over the next few months, reducing the supply of black gold on the market. If Brent prices climb past $82 a barrel, he said prices up to $90 would be a near-term possibility. USA crude exports may rise to 5 million barrels a day by 2025 from 2 million barrels a day in 2018, Thomas Waymel, president of trading and shipping at Total SA, said.

The so-called "OPEC+" group, which includes the likes of Russia, Oman and Kazakhstan, met at the weekend to discuss a possible increase in crude output, but the upshot of the gathering was that the group was in no rush to do so.

But he said the trade war between China and the United States as well as Trump's sanctions on Iran were creating new challenges for oil markets.

In addition, we have to remember we're dealing with a massive decline in Venezuelan oil.

Major oil trading houses are predicting the return of $100 crude for the first time since 2014 as the market braces for the loss of Iranian supplies because of US sanctions.

To reflect rising US oil exports, CME Group Inc (CME.O) said on Monday it will launch a WTI Houston crude futures contract in the fourth quarter.

Saudi Arabia leads the Opec oil cartel, while Russian Federation is the biggest oil producer outside the group.

Delegates from major oil-producing nations have agreed to continue working to boost output.

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It remains to be seen if the Organization of the Petroleum Exporting Countries (OPEC) will raise output to offset dwindling supplies.

OPEC's reticence, combined with signs of accelerating supply losses from Iran, created a bullish mood the annual gathering of the Asian oil industry, traders, refiners and bankers in Singapore on Monday.

American tight oil production will rise to 16 MMbpd by the late 2020s, the report said, making up nearly 25% of total non-OPEC supply by then.

Saudi Arabia signalled the kingdom is in no rush to bring oil prices down from current levels.

According to analysts from Energy Aspects, the meeting on Sunday could lead to an increase in production, "but the market starts to ask where could well come in these barrels".

Iranian leaders have already threatened to disrupt oil shipments through the Strait of Hormuz, the world's busiest sea route for crude oil exports.

"This is the oil market's response to the OPEC+ group's refusal to step up its oil production", said Carsten Fritsch, commodities analyst at Commerzbank in Frankfurt.

The Saudis and their allies appear to be trying to walk a fine line between placating Trump and not putting so much oil into the market to cause prices to crash - as they did in 2014, damaging their petroleum-dependent economies.

The meeting ended without any member committing to a specific output increase, delegates said.

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