Indian Oil buys U.S. crude to part replace Iran cargoes

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Cooling tensions between the United States and Russian Federation, and corrections from Wednesday's purge, help push the price of oil slightly higher early Thursday.

While the average price for West Texas Intermediate (WTI) crude oil at the New York Mercantile Exchange (Nymex) amounted to US$69.50 per barrel, higher by US$2.36 compared with June 2018.

In the USA, nationwide crude stockpiles dropped 1.35 million barrels last week, according to the EIA, while supplies stored in the key hub of Cushing, Oklahoma, slid for a twelfth straight week, declining by 590,000 barrels.

"Of course, such decisions being taken by the USA side are absolutely unfriendly and can hardly be associated with the. constructive atmosphere achieved at the latest meeting of the two presidents", he was quoted by Russian news agency Tass as saying. Among the goods affected is crude oil and other petroleum products. The WTI lost 0.47 USA dollar to settle at 68.49 dollars a barrel on the New York Mercantile Exchange, while Brent erased 0.24 dollar to close at 73.21 dollars a barrel on the London ICE Futures Exchange.

Crude oil futures for September delivery ended up $0.16, or 0.2% at $69.17 a barrel.

Global stock markets were mixed Thursday with European stocks trading lower after Chinese markets finished with sharp gains, as investors focus on developments in the trade dispute between the United States and China. German carmaker Daimler AG froze a plan to make Mercedes Benz trucks in Iran, while Total SA said it couldn't risk investing in Iran because of its large United States operations.

President Donald Trump installed the first wave of sanctions Monday, targeting Iran's financial, automotive, aviation and metals sectors and threatening that the second wave will "ratchet up to yet another level" in November.

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Iran is the third-largest producer in the Organization of the Petroleum Exporting Countries.

The market was also bolstered by a report on Tuesday from the American Petroleum Institute, which said crude inventories fell by 6 million barrels in the week to August 3 to 407.2 million.

As recently as June, China was the top foreign buyer of USA crude, importing a record 15 million barrels that month.

Markets were still supported by the introduction of new US sanctions against Iran on Tuesday, which initially target Iran's purchases of USA dollars - in which oil is traded - metals trading, coal, industrial software and its auto sector. U.S.net imports of crude oil is a very important value for the oil price movements.

Sen added that Iranian production falling by 1.5 million bpd by year end could wind up being a conservative figure, and Bank of American Merrill Lynch pointed out in a research note that "for every 1 million bpd imbalance, we see a price impact on Brent of around $17". It fell 3.2 per cent to $72.28 a barrel in the previous session.

The move is likely to make a severe impact on global crude supply.

Refinery crude runs rose by 118,000 barrels per day, EIA data showed.

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