Investing.com – WTI crude oil prices settled sharply lower Monday, pressured by expectations for an increase in supplies after U.S. Treasury Secretary Steve Mnuchin said some crude importers may receive waivers to continue buying supplies from Iran.
On the New York Mercantile Exchange crude futures for August delivery fell 4.2% to settle at $68.06 a barrel, while on London's Intercontinental Exchange, Brent fell 4.5% to trade at $71.92 a barrel.
"We want people to reduce oil purchases to zero, but in certain cases if people can't do that overnight, we'll consider exceptions," Mnuchin told reporters on Friday, Reuters reported. The comments were not released until Monday morning.
This somewhat softer outlook on restrictions of Iranian crude oil buyers comes as U.S. President Donald Trump has repeatedly called on OPEC to address the sharp uptick in oil prices, which rose earlier this month, to levels not seen since November 2016.
With the drop in Iranian crude supplies likely to be less than many had anticipated, investors have lowered expectations for a shortage in global crude supplies.
Expectations of increased crude supplies were heightened as Libyan ports reopened, while Iraq output reportedly soared in the first half of the July .
Iraq crude exports jumped 6% to 4.05 million barrels a day (bpd) in the first half of July from 3.839 million bpd for the entire month of June, according to tanker tracking and data from port agents compiled by Bloomberg.
The slump in oil prices comes as oil market observers were monitoring potential comments on oil markets at the meeting between President Donald Trump and Russian President Vladimir Putin on Monday.
Putin hinted that the U.S. and Russia could work together in a constructive way to regulate the international energy markets as an extreme drop in prices was not in Russia's interest.
That, however, did little to stem the plunge in oil prices, as attention shifted toward weekly U.S. petroleum inventory data from the American Petroleum Institute on Tuesday, and from the Energy Information Administration on Wednesday.