Crude Oil Futures Decline Despite U.S. Sanctions on Iran-Linked Network

Crude oil futures declined on Wednesday morning, even as the U.S. imposed sanctions on a network of companies and vessels involved in transporting Iranian oil, The Caspian Post reports citing foreign media.

At 9.58 am on Wednesday, November Brent oil futures were at $68.94, down by 0.29 per cent, and October crude oil futures on WTI (West Texas Intermediate) were at $65.42, down by 0.26 per cent. September crude oil futures were trading at ₹5,766 on Multi Commodity Exchange (MCX) during the initial hour of trading on Wednesday against the previous close of ₹5,786, down by 0.35 per cent, and October futures were trading at ₹5,734 against the previous close of ₹5,761, down by 0.47 per cent.

On Tuesday, the US Treasury Department imposed sanctions on a network of companies and vessels led by an Iraqi-Kittian businessman for transporting Iranian oil, which the US claimed was falsely labelled as Iraqi crude.

A press release by the US Department of the Treasury, said Waleed Khaled Hameed al-Samarra’i (al-Samarra’i), a citizen of both Iraq and St Kitts & Nevis, is a United Arab Emirates (UAE)-based businessman who runs a network of companies managing vessels that have been involved in the sale of Iranian oil to international markets.

“This network operates primarily by covertly blending Iranian oil with Iraqi oil, which is then marketed intentionally as solely of Iraqi origin. Based on conservative estimates, al-Samarra’i’s network generates around $300 million of value to both Iran and its partners annually,” the release said.

Markets are waiting for the scheduled meeting of the Organization of Petroleum Exporting Countries and allies (OPEC+) on September 7. Investors are expecting OPEC+ to leave the output unchanged. OPEC+ has increased production output over the past few months.

September nickel futures were trading at ₹1,331.50 on MCX during the initial hour of trading on Wednesday against the previous close of ₹1,344.80, down by 0.99 per cent.

On the National Commodities and Derivatives Exchange (NCDEX), September cottonseed oilcake contracts were trading at ₹3,422 in the initial hour of trading on Wednesday against the previous close of ₹3,405, up by 0.50 per cent.

October turmeric (farmer polished) futures were trading at ₹12,202 on NCDEX in the initial hour of trading on Wednesday against the previous close of ₹12,230, down by 0.23 per cent.