OPEC sees global oil supply as robust

Oil prices climb as Iran sanctions loom

Oil up over 2% on concerns over Iran, slower US output growth

USA light crude CLc1 fell $1.15 to a low of $69.22 a barrel.

According to the Organization for Economic Cooperation and Development (OECD), weaker demand in Europe, Asia, as well as higher gas prices in the US, put some downward pressure on the pace of demand growth, while shakiness in emerging markets over trade disputes and weakened currencies pose a risk to demand outlook for 2019.

The Wall Street Journal said OPEC's total oil production climbed last month, in a sign the oil cartel is sticking with a decision to begin pumping out more barrels of crude this summer after more than a year of holding back output.

Brent for November settlement lost 43 cents to $79.31 a barrel on the ICE Futures Europe exchange after rising above $80 for the first time since May 22 on Wednesday.

"The Midwest accounted for the lion's share of the inventory drop, while lower crude imports, higher crude exports and higher refinery runs on the Gulf Coast also help explain away a good part of today's crude draw", he said.

"The looming supply gap that the loss of Iranian oil exports represents is still ahead of us and that early November U.S. deadline to reduced imports to zero is fast approaching".

Oil prices held firm on Tuesday, with US fuel markets seen to be tightening, although the release of crude from the American strategic reserve somewhat offset an expected supply cut due to upcoming sanctions against Iran.

The issue of additional United States sanctions that are being imposed on Iran was again a major subject of market attention, with Russian Energy Minister Alexander Novak warning of the impact that the the U.S. action could have on Iranian oil sales.

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The EIA's most recent weekly ethanol production data shows production reached 1.087 million barrels per day the week ending August 31, up from 1.07 million barrels per day the previous week.

Washington has told its allies to reduce imports of Iranian oil and several Asian buyers, including South Korea, Japan and India, appear to be falling in line.

Novak said global oil markets were "fragile" due to geopolitical risks and supply disruptions, but added his country could raise output if needed.

Oil product stocks did rise, with distillate holdings, which include diesel and heating oil, climbing by 6.2 million barrels, while those for gasoline rose 1.3 million, according to the EIA data.

The IEA forecasts non-OPEC production to grow by 2 million bpd in 2018 and 1.8 million bpd in 2019, characterized by "relentless growth led by record output from the U.S".

OPEC said the world will need 32.05 million bpd from its 15 members in 2019, unchanged from last month.

Chinese media Xinhua said the U.S. Energy Information Administration (EIA) forecast on Tuesday that U.S. crude oil production will average 10.7 million bpd in 2018, up from 9.4 million barrels bpd in 2017, and will average 11.5 million barrels bpd in 2019.

Russian energy minister Alexander Novak on Wednesday warned of the impact of US sanctions against Iran.

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