Brent oil falls more than $2 after Trump tariff threat,
Libya ports reopen
Send a link to a friend
[July 11, 2018]
By Christopher Johnson
LONDON (Reuters) - Global oil benchmark
Brent fell more than $2 a barrel on Wednesday after U.S. President
Donald Trump threatened to levy new tariffs on China and Libya announced
the reopening of key oil export terminals.
The specter of tariffs on a further $200 billion of Chinese goods sent
commodities lower along with stock markets, as tension between the
world's biggest economies intensified.
Brent crude <LCOc1> fell $2.06, or 2.61 percent, to a low of $76.80
before recovering slightly to $76.86, down $2.00, by 0945 GMT.
U.S. light crude <CLc1>, supported by a tight North American market, was
down 75 cents at $73.36 a barrel.
"Trade concerns have bitten today," said Michael McCarthy, chief markets
strategist at CMC Markets. "If these tariffs are introduced there will
be an impact on global growth and demand."
The price fall was aided by news Tripoli-based National Oil Corp (NOC)
had lifted a force majeure on four Libyan oil ports, saying production
and exports from the terminals would "return to normal levels in the
next few hours".
Libyan oil production fell to 527,000 barrels per day (bpd) from a high
of 1.28 million bpd in February following the port closures, the NOC
said on Monday.
"The lifting of force majeure at all the Libyan ports will certainly
come as relief from a supply perspective, but it remains to be seen how
quickly exports can return to normal," Harry Tchilinguirian, head of oil
strategy at BNP Paribas, told Reuters Global Oil Forum.
Adding to the bearish mood were signs of a possible relaxation of U.S.
sanctions on Iranian crude exports.
[to top of second column] |
An oil pump jack is seen
at sunset near Midland, Texas, U.S., May 3, 2017. REUTERS/Ernest
Scheyder/File Photo
U.S. Secretary of State Mike Pompeo said on Tuesday that Washington would
consider requests from some countries to be exempt from sanctions due to go into
effect in November to prevent Iran from exporting oil.
Washington had previously said countries must halt all imports of Iranian oil
from Nov. 4 or face U.S. financial measures, with no exemptions.
The United States pulled out of a multinational deal in May to lift sanctions
against Iran in return for curbs to Tehran's nuclear program.
The prospect of sanctions on oil exports from Iran, the world's fifth-biggest
oil producer, has helped push up oil prices in recent weeks with both crude
contracts trading near 3-1/2-year highs.
Supply to the U.S. market has also been squeezed by the loss of some Canadian
oil production.
U.S. crude inventories fell last week by 6.8 million barrels, according to the
American Petroleum Institute, an industry group.
Analysts polled by Reuters forecast on average that crude stocks fell by 4.5
million barrels, ahead of government data at 10:30 a.m. EDT (1430 GMT) on
Wednesday.
(GRAPHIC: Iran crude oil exports to major Asian clients in H1 2018 - https://reut.rs/2NIum8v)
(Additional reporting by Aaron Sheldrick in Tokyo; Editing by Dale Hudson)
[© 2018 Thomson Reuters. All rights
reserved.] Copyright 2018 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.
Thompson Reuters is solely responsible for this content.
|