Oil inches up on surprise draw in USA crude stockpiles

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Iranian Oil Minister Bijan Namdar Zanganeh said US can not balance a market which is suffering from short supply by words and bullying, ILNA reported.

US crude stocks rose 6.5 million barrels last week, the fourth straight weekly build, nearly triple what analysts had forecast, the US Energy Information Administration said on Wednesday. Those sanctions would block banking channels, making payment for oil bought from Iran hard as well as stop re-insurance cover to refineries processing such oil.

"The problem is the United States has the capability of increasing production substantially, but we don't have the pipelines to take that extra crude from West Texas, North Dakota, the Rockies to the market very, very quickly. There is plenty available in different parts of the world". This increases demand, so typically between now and New Year's Day we will see buyers return to this market on dips.

"The oil market is suffering from short supply and this can not be resolved by words".

"There is no problem on this issue", Kardor said, Iran's ISNA news agency reported. The global benchmark, which hit a two-week low late last week as equity markets dropped, is trading around $5 below a four-year high of $86.74 reached on October 3.

As dramatic as Gordon's proclamation seemed, it was no match for those foreseeing crude in the triple digits such as Patrick Spencer, vice chairman of equities at Baird, who told Bloomberg television that, "we still think we can see oil at $100 before the year is out" due to oil stocks being "under owned, under-believed".

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"We are seeing a well-supplied and balanced oil market right now. In 2019, there is the possibility of a larger imbalance due to more growth in supply". Given the impact of rising oil prices on the rupee and India's trade deficit, his motivations were clear.

Crude has risen for two out of three sessions this week after Saudi Arabia hinted it may use its oil wealth as a weapon against any punitive measures tied to the disappearance of a prominent regime critic. We continue to import 3.3 million barrels per day from OPEC. While Saudi Arabia and Russian Federation have increased production, "according to our information some of the (OPEC) countries are lagging behind".

I was on CNBC Asia on Sunday evening as oil prices jumped higher, discussing how the disappearance of Jamal Khashoggi was unlikely to impact energy flows between the USA and Saudi Arabia.

Oil held gains after an industry report showed an unexpected drop in American crude stockpiles. "Saudi Aramco's desire is also to invest in consumer-facing segments such as retail fuels and petrochemicals, building an integrated downstream business spanning India as well as our commitment to invest in crude oil storage here in India in order to be more responsive and closer to the demand needs". Saudi Arabia has denied the allegation.

"These optional volumes can be taken at any time of the year and would be more than sufficient to make up for any shortfall that may arise because of the United States sanctions against Iran".

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