Saudi Arabia says ready to boost oil production, taking aim at Iran

Outside North America, looming US sanctions against major oil exporter Iran were the focus of attention.

Oil prices edged up on Wednesday, lifted by a report of declining USA fuel inventories amid the ongoing crude supply outage at Syncrude Canada in Alberta, which usually supplies the United States.

After the U.S. withdrew from the Iranian nuclear deal in May, it said it would reimpose economic sanctions against Tehran by November.

The restart of those sanctions has global energy buyers nervous as to who will replace those barrels.

US crude stockpiles are forecast to have declined 5 million barrels last week, according to a Bloomberg survey ahead of government data to be released on Thursday.

Saudi Arabia doesn't seem to be in a rush to fulfill Trump's request for an extra 2 million barrels per day.

President Trump lashed out at OPEC with a warning to stop manipulating oil markets and piled pressure on close USA allies in an interview that aired on Sunday with a threat to sanction European companies that do business with Iran. Gasoline and distillate stocks, which include diesel and heating oil, were also down, the API said.

He said in the Fox interview that European companies would face sanctions if they traded with Iran now.

"Our focus is on getting as many countries importing Iranian crude down to zero as soon as possible", Hook said.

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The issue is of concern as crude oil prices hit four-year highs.

"The Vienna meeting [4th OPEC meeting] sought to maintain production". But with inventories already below five-year averages and little spare capacity available, oil markets look set to tighten.

"Just spoke to King Salman of Saudi Arabia and explained to him that, because of the turmoil & dysfunction in Iran and Venezuela, I am asking that Saudi Arabia increase oil production, maybe up to 2,000,000 barrels, to make up the difference", Trump said in a tweet on Saturday.

"Recurring salvos in the trade war and falling asset prices raise the question of how much tariffs could damage the global economy", U.S. bank JPMorgan said.

But a flurry of USA announcements over the weekend unsettled oil markets.

At 11:06 a.m. EDT WTI crude was trading at $73.18, down $0.76 (-1.03%). "Iran. OK. You think of it. Iran is their big enemy, so they are going to have to do it", Trump said. But Indian banks and insurers have said they would not finance oil transactions with Iran.

Donald Trump is urging oil producing countries except Iran to boost output. But he says the USA "is prepared to work with countries that are reducing their imports on a case-by-case basis".

State Deparment's Hook says any sort of waiver or similar moves would reduce pressure on Iran.

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