Brent inches up on tighter sanctions against Iran

The front-month ICE Brent contract has inched $0.34/bbl higher on the day, to trade at $74.76/bbl at 09.00 GMT.

PHOTO: Oil barrels. Getty Images

Upward pressure:

Brent futures erased the previous day’s losses after the US government imposed fresh sanctions on Iran, one of OPEC’s largest oil-producing members.

Washington has sanctioned several vessels and companies allegedly involved in exporting Iranian oil. These measures, aimed at reducing Tehran’s exports to zero, have supported oil prices.

Brent’s price gains were “helped by expectations of a growing crimp on Iranian crude exports as the US continues to tighten oil sanctions against the country,” VANDA Insights’ founder and analyst Vandana Hari remarked.

Downward pressure:

Oil traders are now waiting for resumption of Iraqi crude flows via Kurdistan. This has added some downward pressure on Brent crude oil, according to market analysts.

The second-largest OPEC producer is expected to restart crude exports from Kurdistan in the coming days, via a pipeline through Turkey.

“Iraq said that it may restart exports as early as this week should a pipeline to Turkey resume operations,” ANZ Bank’s senior commodity strategist Daniel Hynes said.

Iraq is currently waiting for Turkey's approval to restart the oil flows, Reuters reported citing Iraq’s oil minister, adding that Kurdish oil exports will hopefully be ready in two days.

By Aparupa Mazumder

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