Oil prices steadied on Friday after a week of heavy falls as markets braced for the imposition next week of U.S. sanctions on Iran, which Washington hopes will halt exports of Iranian oil.
Benchmark Brent crude was up 11 cents a barrel at $73 by 7:50 a.m. ET (1350 GMT). The contract has fallen about 6 percent this week and nearly 16 percent since the beginning of October when it reached its highest since 2014.
U.S. West Texas Intermediate (WTI) crude futures were down 12 cents at $63.57, down more than 17 percent since hitting four-year highs a month ago.
Investors are concerned about the prospects for oil supply when new U.S. sanctions are implemented against Iran on Monday.
Washington has said it aims eventually to stop all Iranian oil exports but has granted several countries waivers on sanctions, allowing them to continue imports for a while.
The U.S. government has agreed to let eight countries, including close allies South Korea and Japan, as well as India, keep buying Iranian oil after it reimposes the sanctions, Bloomberg reported on Friday, citing a U.S. official.
“Oil prices look to remain under pressure, as fears of global oversupply have returned with a vengeance,” said Ashley Kelty, oil and gas research analyst at Cantor Fitzgerald Europe.
A list of all countries getting U.S. waivers allowing them to import Iranian oil is expected to be released officially on Monday, industry sources say. Despite these efforts, waivers are likely to be only temporary.
Goldman Sachs said it expected Iran’s crude oil exports to fall to 1.15 million bpd by the end of the year, down from around 2.5 million bpd in mid-2018.
Beyond Iran sanctions, oil output has been rising significantly in the past two months.
Russian Energy Ministry data showed on Friday the country pumped 11.41 million barrels per day (bpd) of crude oil in October, a 30-year high.
The Organization of the Petroleum Exporting Countries boosted oil production in October to 33.31 million bpd, up 390,000 bpd and the highest by OPEC since 2016.
And in the United States, crude production is now well over 11 million bpd, putting the United States in a neck and neck race with Russia for the title of top producer.
But Goldman Sachs analysts say they expect Brent prices to fall to $65 a barrel by the end of next year, largely due to “the unleashing of Permian (U.S. shale) supply growth once new pipelines come online.”