On Tuesday, Brent crude fell by $2.25 a barrel to a low of $75.09 before recovering slightly to around $75.89 as of 8:10pm Nigerian time. U.S. West Texas Intermediate (WTI) crude CLc1 futures fell $1.16 to $65.88 a barrel, down 1.7 percent. Oil has been caught in the global financial market slump this month, with equities under pressure from the trade fight between the world's two largest economies.
Structurally oil prices remain bearish as the Brent curve moves deeper into contango (Spot price lower than forward price).
On a weekly basis, US crude production stood at 11.2 million bpd last week.
The Organization of the Petroleum Exporting Countries boosted oil production in October to 33.31 million bpd, up 390,000 bpd and the highest by OPEC since 2016. EIA estimates of crude oil production from tight formations in August 2018 reached 6.2 million b/d, or 55% of the national total.
The summer driving season usually leads to higher consumption of gasoline in the United States for domestic travel, while the early fall is instead a period marked by refinery maintenance, all of which reduces oil consumption.
Monthly crude oil production in several USA states reached a record high.
The company said that Syncrude operations in Canada were impacted by a power supply disruption that began in late June with recovery by the middle of September, and highlighted progress in exploration during the quarter in Guyana while it increased rights for exploration areas in Brazil. The increase in OPEC production "has really started to tamp down concerns surrounding the loss of Iranian barrels".
"It is doubtful whether Iranian oil exports will fall much further from their current level, however", a report by Commerzbank AG said.
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Investors will look to official government data on US inventories due on Wednesday.
"We think Trump will agree to China importing some volumes, similar to the treatment that India and South Korea receive", he said.
Japan is seeking a similar deal.
The United States will grant temporary waivers to eight "jurisdictions" from the sanctions on Iranian energy imports next week, according to Pompeo.
"The US may use waivers to slow-walk implementation, but these will not apply indefinitely", he added.
The Schork Report editor Stephen Schork on USA oil production and why he believes that the market has adjusted to the Iran sanctions.
"The strong built in oil inventories is likely to keep downward pressure on oil prices", ANZ Research analysts said in a note.
Benchmark Brent crude now trades above $80 a barrel.