Oil is taking a beating today, shedding more than $3

Khashoggi’s death exposes ‘friends’

Indian conglomerate Reliance Industries has already stopped importing crude oil from Iran to comply with US sanctions because of its large exposure to worldwide markets and the USA financial system.

The kingdom, which produces more than a tenth of global supplies, had vowed on Monday not to withhold its output as a political weapon amid the worldwide backlash over the murder of journalist Jamal Khashoggi.

Falih said that he believes the oil market is "in a good place today in terms of supply and demand balances and inventories" after lifting restrictions on output in June.

The US is reimposing sanctions on Iran, another major oil exporter, from November 4 after President Trump pulled out of the nuclear deal with the country.

While Saudi Arabia is intent on making up for lost barrels, the outlook for demand next year is deteriorating. Meanwhile, Iran's oil minister Bijan Zanganeh has said that Saudi Arabia and Russian Federation can not replace Iran' oil as the production capacity of the two countries has reached its peak.

Iran's minister of petroleum says Saudi Arabia has submitted to United States pressure, violating an OPEC agreement reached in June not to raise its production.

Falih said Saudi Arabia would soon raise output to 11 million barrels per day (bpd) from the current 10.7 million.




USA light crude dropped $3.03, or 4.4 percent, to $66.33 a barrel, after earlier hitting a two-month low at $65.74.

Additionally, U.S. Treasury Secretary Steve Mnuchin, visiting Israel this week, said on Sunday that it will be hard for countries to receive waivers on Iran oil sanctions.

Meanwhile, Russia's oil production is now 150,000 bpd higher than the October 2016 level, the baseline for the global oil production deal, TASS news agency quoted Energy Minister Alexander Novak as saying.

Oil prices spiked on the move, as they did later in 1979 because of the Iranian revolution. "So we have to use oil reserves".

"My role as the energy minister is to implement my government's constructive and responsible role and stabilizing the world's energy markets accordingly, contributing to global economic development".

"We will decide if there are any disruptions from supply, especially with the Iran sanctions looming", Falih said. There has been concern that just as markets tighten on the back of the USA sanctions against Iran, Saudi Arabia could cut crude supply in retaliation for potential sanctions against it over the Khashoggi killing.

USA crude oil production has climbed by nearly a third since mid-2016 to around 11 million barrels per day, and rising drilling activity points to further increases.

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