Crude oil prices steadied near multi-year highs on Wednesday, even as concerns over geopolitical tensions began to ease, as supply cut efforts by global oil producers continued to support the commodity. Oil prices had climbed amid Iranian protests, marking the biggest challenge to the country's clerical leadership since 2009. However, the protests were showing no signs of impacting Iran's oil production. Crude prices continued to be supported by production cuts led by the Organization of the Petroleum Exporting Countries and Russia. The producers agreed in December to extend current oil output cuts until the end of 2018. Click Read More below for additional information.
Strong buying emerged in oil markets Tuesday as focus shifted to an expected decline in Iranian crude exports after a senior U.S. State Department official said countries must stop purchasing crude by the start of November or face sanctions.
Companies that buy Iranian crude oil must completely halt those exports by Nov. 4 or else they will face powerful U.S. sanctions, a senior State Department official told reporters on Tuesday.
Oil prices moved sharply higher as investor focus shifted to the prospect of a void in global supplies as Iran – OPEC’s third largest producer – exports more than 2 million barrels per day (bpd).
Renewed focus on upcoming sanctions against Iran, offset some earlier weakness in oil prices, which followed a report Saudi Arabia plans to hike crude output to record levels.
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