Oil dips as IMF lowers global growth outlook; eyes on US hurricane

Oil Barrels

Benchmark Brent crude was up 65 cents at $84.56 a barrel by 0850 GMT, having fallen as low as $82.66 on Monday.

US crude was down by 1 cent at $74.28 a barrel, having fallen as low as $73.07 in the previous session to close the day just 5 cents lower.

India, the world's third-largest oil importer, is a major importer of Iranian oil.

Secretary of State Mike Pompeo said on a visit to India in September that some waivers from the sanctions might be granted to countries buying Iranian oil, but only if they agreed to cut their imports to zero.

"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. But hedge funds have amassed a large bullish position in Brent crude, amounting to nearly 470 million barrels, betting prices will head even higher.

This is the first public statement made by the Government on its stand on sourcing Iranian oil once the USA sanction on Iran pertaining to the oil industry comes into force.

"Instead they're talking about 'sufficient pressure, ' which is their language for allowing banks to keep Iran connected to the global financial system, including through SWIFT or with oil waivers", the source said, referring to new efforts by officials in the Treasury Department and European allies to keep Iran connected to the premier worldwide banking system.

USA sanctions against Iran will kick in from 4 November, which will block payment routes.

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.

President Donald Trump has said the Iran oil sanctions are meant to isolate the regime in that country and force them to negotiate a new nuclear deal.

The current stance differs drastically from the administration's position just four months ago, when Trump was pressuring his administration to fully enforce USA sanctions on Iran.

The details provided by Refinitiv Eikon showed the Islamic Republic exported 1.1 million barrels per day (bpd) of crude last week.

Delhi is hopeful that Saudi Arabia and other members of the Organization of Petroleum Exporting Countries will heed United States calls for production to be boosted by one million barrels per day, as promised in June, which might help bring benchmark prices down. Iranian oil exports are declining fast, and the Saudi's have to find a way to increase production quickly. Late in the session, traders will get the opportunity to react to the latest data from the American Petroleum Institute. Early Tuesday, the International Monetary Fund cut its global economic growth forecasts for 2018 and 2019, saying that trade policy tensions and rising import tariffs were taking a toll on commerce while emerging markets struggle with tighter financial conditions and capital outflows.

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