Oil Prices Climb on Iran Sanctions

• Oil Prices Climb on Iran Sanctions

Oil prices climbed higher on Monday during the Asian trading session as supplies were expected to tighten once U.S. sanctions are implemented on November 4th.

Brent Crude, against which Nigerian oil is measured, gained 48 cents to $80.23 a barrel to close above the last close.

Also, U.S crude oil, West Texas Intermediate (WTI), climbed 48 cents to $69.60 per barrel.

U.S. sanctions are expected to target Iran’s oil exports, the third-largest producer in the organization of the Petroleum Exporting Countries (OPEC), in order to force the country to renegotiate its nuclear agreement.

Countries like India that have already reduced importation of Iranian oil are expecting some form of sanction waivers to at least sustain their refineries during the period.

However, U.S. Treasury Secretary Steven Mnuchin on Sunday said it would be harder for countries to get sanction waivers now than it was during Obama administration, when several countries, especially those in Asia, received them.

While OPEC has agreed to boost global oil supply to make up for the expected drop in Iranian exports, an internal document showed OPEC is struggling to boost production as an increase in Saudi production was either offset by a disruption in Venezuela or decline in Libya’s oil production.

The executive director of the International Energy Agency (IEA), Fatih Birol, on Monday said other producers may struggle to up production, therefore, crude oil prices could rise further after November 4th.