This was partly linked to the rise in the prices of the mineral making it hard for buyers to purchase.
The prices for Light, sweet crude oil started accelerating on August 7 on the New York market to settle above $68/bbl for October delivery while the Brent contract for October gained 90¢ and shall settle at $74.65/bbl.
According to Analysts, the rise was influenced by the U.S. president, Donald Trump’s strategy to restore the first of two rounds of economic sanctions against Iran which are set to be evaluated on November 4, 2018.
Trump has challenged other governments to also follow his example and either reduce or stop buying Iranian oil to improve the effectiveness of the unilateral sanctions.
In May, Trump announced a US exit from an international agreement that lifted sanctions against Iran in return for its cooperation regarding Iran’s nuclear program.
“We view that it is very unlikely that the US administration will be successful in reducing Iranian exports to zero,” Ehsan Khoman, head of research for the Middle East and North Africa region at MUFG bank, told the Wall Street Journal.
“Our expectation is for this more aggressive US threat of sanctions to force around 800,000 to 1 million b/d of Iranian crude off the market by November,” Khoman said.(Oil and gas Journal, August 8, 2018)