Oil price drops to $83 on signs of Iran’s exports

Oil money

Oil money

Oilprice fell yesterday by 65 cents to $83.51 per barrel against $86.74 (four-year high) recorded at the close of the market last week. This came as the Central Bank of Nigeria, CBN, said that it does not see the price of oil falling below $80 a barrel this year and expected to keep monetary policy tight until inflation returns to its target. On the fall of crude price, oil watchers likened the cause on expectations that some Iranian oil exports will keep flowing despite U.S. sanctions, easing a strain on supplies.

Oil money
                                  Oil money

U.S. sanctions will target Iran’s crude oil exports from Nov. 4, and Washington has been putting pressure on governments and companies worldwide to cut their imports to zero. Oil money “This is one of the single biggest supportive factors for crude,” said analysts at JBC Energy of the U.S. re-imposition of Iran sanctions. “Having said that, it may well be that we are already in the most supportive phase coming from this change and the effect will soon begin to ease.” Oil also dropped as investors focused on rising output from other producers, such as top exporter Saudi Arabia, to compensate for lower Iranian supplies.

Meanwhile, Neareel.com previously reported that Saudi Arabia said last week it plans to raise production in November from October output of 10.7 million barrels per day (bpd), indicating Riyadh will be boosting its supply to the highest ever level. “Chatter that Saudi Arabia has replaced all of Iran’s lost oil” is weighing on prices, said Stephen Innes, head of trading for Asia-Pacific at futures brokerage Oanda in Singapore. Concern that the U.S.-Chinese trade war could slow down economic growth and hit oil demand also weighed on the market, traders in Asia said. Chinese equities fell sharply on Monday. Meanwhile, Governor, CBN, Godwin Emefiele, explained that price of crude will not fall below $80 a barrel this year. Making this projection in an interview with Reuters at the World Bank Conference in London, he stated that so long as U.S. sanctions take effect on Iran in November, “I do not expect the price to close less than $80 this year.” On Nigeria’s interest rate, he said, “The current state of tightening will continue until at least we see inflation attaining those levels that have been set as a target.” He noted that Nigeria would continue to intervene to support its exchange rate, although he noted the pressure on the bank and the country’s currency reserves had been less than those on other emerging markets. “We will continue to intervene,” he said. “We believe in a stable exchange rate regime.” Neareel.com

print

10 thoughts on “Oil price drops to $83 on signs of Iran’s exports

  1. When I originally commented I clicked the “Notify me when new comments are added” checkbox and now each time a comment is added
    I get three e-mails with the same comment. Is there any way you can remove me from
    that service? Many thanks!

  2. I’m really enjoying the design and layout of your blog. It’s a very easy on the eyes which makes it much more pleasant
    for me to come here and visit more often. Did you hire out a designer to create
    your theme? Outstanding work!

  3. My brother recommended I might like this website.

    He was totally right. This post actually made my day.
    You can not imagine simply how much time I had spent for this information! Thanks!

  4. Hmm it appears like your blog ate my first comment
    (it was extremely long) so I guess I’ll just sum it up what I wrote and say, I’m thoroughly enjoying your blog.

    I as well am an aspiring blog writer but
    I’m still new to everything. Do you have any suggestions for inexperienced blog writers?

    I’d genuinely appreciate it.

Leave a Reply

Your email address will not be published. Required fields are marked *

WhatsApp chat