Oil slips ahead of US inventories data

Oil prices fell slightly with the opening of the US market on Tuesday to drop from the highest level in six months recorded earlier in the European market, this comes ahead of the release of preliminary data on US crude stocks issued by the American Petroleum Institute, while prices have risen widely since the beginning of this week, as concerns about a supply curb in the market grew, especially after the United States tightened sanctions on Iranian oil exports by ending all waivers granted to Iran's oil importers.

By 13:15 GMT, US crude fell to $65.67 a barrel from the opening level of $65.77, with a high of $66.17 (highest since October 31) and a low of $65.57.

Brent crude fell to $74.05 a barrel from the opening level of $74.34 and recorded a high of $74.67 (highest since November 1) and a low of $73.97.

US crude added 2.5% on Thursday, while Brent rose 3.0%, in their second consecutive daily gain, after the US decisions.

A preliminary report on US commercial crude inventories by the US Petroleum Institute (API) will be released later today, amid expectations of a decline in inventories for the second week in a row, while the official data will be released by the US Energy Information Administration tomorrow, Wednesday.

The US government on Monday demanded the Iranian oil buyers to stop imports by May 1st or face sanctions, ending six-month waivers that allowed Iran's top eight oil buyers to continue to import limited quantities.

US Secretary of State Mike Pompeo said that Washington's goal was to stop Iranian oil exports altogether, adding that there were no plans to grant another waivers period after May 1st.

Last November, the United States imposed sanctions on Iranian oil exports after the US President Donald Trump unilaterall withdrawal from the 2015 nuclear deal between Iran and six world powers.

But Washington decided to grant waivers to Iran's major oil buyers - China, India, Japan, South Korea, Taiwan, Turkey, Italy and Greece - which allowed them to continue their limited purchases for six months.

Tehran exported just over 1 million barrels per day in March, down from 1.3 million barrels a day in February, far below the peak of Iran's 2.5 million barrels in April 2018 before US sanctions were imposed.

According to preliminary data from the Organization of Petroleum Exporting Countries (OPEC), Iran's exports have shrunk to well below 1 million bpd in April.

The Barclays bank said in a note following the decision announcement that it surprised many market participants, and that it will lead to a significant tightening in the market.

The British bank also added that Washington's goal of cutting Iran's oil exports to zero is an upward threat to the average price of Brent crude from an annual average of $65 per barrel to $70 a barrel this year.