Published: Tue, September 04, 2018
Business | By Eloise Houston

Japanese Oil Wholesalers ‘Prepare To Suspend’ Iranian Imports

Japanese Oil Wholesalers ‘Prepare To Suspend’ Iranian Imports

The first week of August didn't see much change in crude oil price as dollar denominated Crude Oil WTIUSD moved in sync with momentum from last week of July.

China, Turkey and India will likely continue to buy Iran's oil, while other major purchasers including Japan, South Korea and European nations are already shunning its crude.

U.S. oil prices rose on Tuesday, breaking past $70 per barrel, after two Gulf of Mexico oil platforms were evacuated in preparation for a hurricane.

Crude oil "prices could reach $80 and higher in the short term", the bank said, although it added that despite these developments global supply may exceed demand next year.

Brent crude, the global benchmark, was up 0.58% to $78.09 a barrel on London's Intercontinental Exchange. Turkish crisis also weighed down on Crude oil market on the early week but Crude oil price action rebound from monthly lows on news of the United States and Chinese representatives meeting for two day talks to try and resolve an ongoing trade dispute.

Crude gained further on news of Sino-U.S.

Even though there are risks, there are always geopolitical risks in oil so it's a matter of managing risk.

That has forced Japanese oil companies to prepare to suspend Iranian imports and look for ways to switch to other Middle East producers, Japanese media report. Sanctions on Iran that is set to begin in November and OPEC summit will continue to remain investor's main focus while Geo-political events and trade war proceedings will dictate momentum in near future trading sessions.

Jiji Press agency and Kyodo on September 3 reported that the action comes in response to USA sanctions against Tehran and threats they could be extended to companies doing business with Iran.

"Crude oil export losses from Iran due to US sanctions, production decline in Venezuela and episodic outages in Libya are unlikely to be offset entirely by corresponding rises in OPEC+ production due to market share sensitivities", the bank said.

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