Oil edges up on Iran sanctions, but US-China row mutes trading

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Giovanni Staunovo, a commodity analyst and chief investment officer at Swiss bank UBS, said in response to questions emailed from UPI that API is the main driver behind the rally this morning, though official data from the U.S. Energy Information Administration could make or break the rally.

U.S. West Texas Intermediate (WTI) crude futures CLc1 were at $68.24 per barrel, up 41 cents, or 0.6 percent. The three fields contribute about 45,000 to 50,000 bpd to the North Sea's Forties and Brent crude streams. Refinery utilization rates remained unchanged last week at 98.1 percent of total capacity, the highest rates since 1999.

USA crude oil exports averaged 1.15 million barrels per day last week, down by 437,000 barrels per day from the previous week.

The crude oil futures prices in NY went up by 1.2% as the United States government offered 11 million barrels of oil as a part of the regular draw-down schedule.

Global benchmark Brent crude oil futures were at $74.63 per barrel at 0422 GMT, down 18 cents, or 0.2 per cent, from their last close.

Concerns also remain over how much oil will be removed from global markets by renewed sanctions on Iran, despite worries that demand growth could weaken amid a trade disputes between the U.S. and China, the world's two biggest economies.

OPEC stated: "The price of OPEC basket of 15 crudes stood at $70.27 a barrel on Friday, compared with $69.47 the previous day, according to OPEC Secretariat calculations".

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According to the Weekly Petroleum Status Report, U.S. commercial crude oil inventories, excluding those in the Strategic Petroleum Reserve (SPR), decreased by 5.8 million barrels during the week ending August 17.

A weaker United States dollar makes oil, which is priced in dollars, less expensive to buyers in other currencies.

Today, three months before the November deadline when the sanctions are due to take effect, Iran's outflow has already fallen by around 430,000 barrels and the nation has to rely more on its own fleet of tankers to carry oil to its customers, clearly showing that buyers are hesitant to continue purchasing Iranian oil.

Nationwide, crude oil exports rose to a record high of 2 million barrels per day in May, according to the department. Saudi Arabia told Opec it cut supply in July, rather than increasing output as expected.

The US/China trade tensions fuelled concerns that global economic growth could slow, weakening worldwide energy demand.

Worries that Mexico's incoming administration would not strike a bilateral agreement over NAFTA with the USA also weighed on the market, traders said.