Iran's Oil Exports Rapidly Decline As Other Producers Fill The Void

Crude Oil Price Analysis Resistance Breached Bulls Take Charge

Oil prices see-sawed in a volatile, heavy day of trading on Friday, selling off after news that major producers would consider additional supply one day after U.S. President Donald Trump again blasted the cartel.

Trump's comments come ahead of the Organization of the Petroleum Exporting Countries meeting with Russian Federation and other big producers for the World Oil Outlook meeting in Algiers this weekend where they will discuss boosting output to push prices down and compensate for looming sanctions on Iranian oil. "Some of these increases are also being driven by unsourced reports that Saudi Arabia may be comfortable with prices above $80, despite the upcoming USA midterm election".

"We're stuck in a range here", said Tariq Zahir, managing member at Tyche Capital Advisors in NY, with prices supported by the USA sanctions on Iranian supplies and pressured by the potential that Chinese demand could wane.

Incumbents who face challengers in the upcoming USA mid-term elections have reasons to want oil prices - and in turn, gasoline prices at the pump - to be lower this fall, too.

Futures prices for WTI crude, the US benchmark, dipped slightly following the tweet and were lower by 0.2% on the day.

Over the past four years, changes to USA crude oil transportation infrastructure and the fluctuations in the Brent-WTI spread have resulted in refiners in the East Coast receiving the highest crude volumes by tanker and barge from the Gulf Coast since 2014, while crude by rail shipments from the Midwest have slumped 77 percent from the late-2014 peak, the EIA said in an analysis on Thursday.

Distillate stockpiles, which include diesel and heating oil, rose by 839,000 barrels, versus expectations for a 651,000-barrel increase, the EIA data showed.

The so-called 'OPEC+' coalition meets on Sunday in Algeria to discuss how to allocate that 1 million bpd increase within its quota framework. The price of oil is up 7 percent in the last month and almost 18 percent for 2018.

He has also previously criticised the oil producer group, whose members include Qatar, Saudi Arabia and Kuwait, accusing it of driving prices higher.

The comments come just ahead of this weekend's meeting of a committee monitoring the supply pact between OPEC, Russia and some other non-OPEC producers.

According to AAA, the current national average pump price per gallon of regular gasoline is $2.843, up less than a penny from $2.839 a week ago and virtually unchanged compared with the month-ago price.

Trump's tweet comes about two months after a similar tweet in July, in which he also called OPEC a monopoly and tacitly threatened to withdraw United States support. In the last two weeks, Al-Falih has met his counterparts from Russian Federation and the U.S., Alexander Novak and Rick Perry, to discuss the oil market and the impact of U.S. sanctions on Iran.

The backdrop to all of this has been the meteoric, and largely surprising, emergence of the United States as an oil superpower, a development helped along by the incremental increase in prices.

Petrol consumption usually picks up in the summer and wanes in autumn, but demand remained strong in the latest week, estimated at 9.5 million barrels per day.

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