USA crude oil inventories decrease further last week: API

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Despite this, French bank BNP Paribas said the "agreement to elevate output still leaves production restraints in place, limiting the market's ability to rebuild inventories".

But Saudi Arabia and Russian Federation had other ideas.

Under these circumstances, Japanese oil wholesalers are trying to make sure that they can stably secure crude oil. "Last month, Iran exported 2.8 million barrels of crude oil and condensate per day", the Iranian official said. How much more will Venezuelan production decline? "Maintaining close ties with Iran, which is rich in oil and natural gas, contributes to the national interests of resource-poor Japan", said a senior official of the Economy, Trade and Industry Ministry.

Instead, it was left to Saudi and Russian officials to brief the media afterwards that collective output would increase by around 1 million bpd.

On top of that, the lack of CapX spending by big oil companies leaves them in a bad position to try to quickly bring on more supply. It is the world's seventh largest oil exporter. The three storage tanks that were destroyed will take years to fix. But as the news about a jump in Saudi output filtered out, oil prices cooled. But the industry sources said India, the biggest buyer of Iranian oil after China, will be forced to take action to protect its exposure to the United States financial system.

The Treasury Department announced that it had revoked licenses that allowed US -controlled foreign companies to export commercial aircraft parts to Iran as well as permitted Americans to trade in Iranian carpets, pistachios and caviar. Russian company Lukoil has already confirmed it has put its Iran plans on hold ahead of the sanctions deadline.

Zanganeh was also told if the deal was blocked by Iran, it may lead to the withdrawal of Russian Federation from the agreement, the sources said. At the same time, she described Iran as next North Korea.

The event also re-imposes Saudi Arabia's supremacy in directing Opec's strategy since it is the only member with ample spare capacity. The shrinking availability of finance from worldwide banks could enlarge the disruptions in Iranian oil exports as well. China and India are among the largest importers of oil from Iran.

Crude closes at a 3 1/2 year high amid shrinking stockpiles in the United States, disruptions at Libyan ports and other worldwide supply risks. If a 25 percent duty on USA crude imports is implemented by Beijing, American oil would become uncompetitive in China, forcing it to seek buyers elsewhere.

According to Helima Croft, global head of commodities research at RBC, the Thursday statement from the State Department shows that the US wants to be aggressive in reducing as much Iranian oil exports as possible, and companies have already started to react.

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