Investing.com - Oil prices fell on Friday as China ordered at least two state-owned oil companies to stop buying Iranian oil.
Crude Oil WTI Futures for December delivery fell 0.8% to $66.77 per barrel by 12:13 AM ET (04:13 GMT) on the New York Mercantile Exchange. Brent Oil Futures for December delivery traded 0.6% lower to $76.47 a barrel on London’s Intercontinental Exchange
Citing people with knowledge of the matter, Bloomberg reported that China National Petroleum Corp and Sinopec have been told to avoid buying Iranian oil, although the freeze on imports are expected to be only temporary, the people added.
U.S. sanctions against Iran is scheduled to take effect from Nov. 4 and earlier reports suggested that Washington is seeking to eventually reduce Iran’s exports sales to zero and isolate the Islamic Republic.
In other news, oil prices received some support earlier in the day after OPEC signaled on Thursday it may have to return to production cuts as global inventories begin climbing, a move that may further sour its relations with U.S. President Donald Trump.
Saudi OPEC governor Adeeb Al-Aama told Reuters the oil market could be shifting towards oversupply due to a typical rise in inventories and slowing in demand in the fourth quarter.
"The market in the fourth quarter could be shifting toward an oversupply situation as evidenced by rising inventories over the past few weeks," Adeeb Al-Aama told Reuters.
Aama’s stance suggested a rethink in Saudi production strategy after Falih said earlier this week that the kingdom will pump as much crude as necessary to ensure minimum disruption to global supplies from U.S. sanctions on Iranian oil exports.