Uncertainty over US waivers for buyers of Iranian oil is starting to grip the market again, under very different circumstances than when American sanctions were set to go into effect last year.
Before existing exemptions were granted in early November, Saudi Arabia was pumping at record levels, benchmark Brent futures rose to a four-year high, traders were predicting $100 oil, and Donald Trump was seeking lower fuel prices ahead of US mid-term elections.
The waivers blindsided the market, which had assumed America would bring Iranian exports to zero, and sparked a 40 percent collapse in crude. Now, as the six-month waivers allowing buyers to ship limited quantities approach their expiry, the Saudis are pursuing aggressive output cuts, US sanctions on Venezuela have further squeezed supplies and OPEC producers burned by last quarters oil slump are defying Trump’s call for lower prices.
