Oil increases as US raw stocks decline, Iranian sanctions weigh

SEOUL (Reuters) – Oil prices rose Wednesday, supported by a fall in US crude stocks and a weaker dollar, along with concerns about a possible shortage of Iranian oil from November due to US sanctions.

FILE PHOTO: A pump connection operates at a well site that is rented by Devon Energy Production Company near Guthrie, Oklahoma, USA, September 15, 2015. REUTERS / Nick Oxford / File Photo

Brent crude oil futures LCOc1 were at $ 72.83 per barrel at 0234 GMT, an increase of 20 cents, or 0.3 percent, of their last slot.

US West Texas Intermediate (WTI) raw futures CLc1 rose 28 cents or 0.4 percent, at $ 66.12 per barrel.

US crude stocks fell by 5.2 million barrels in the week to 17 August, to 405.6 million barrels, ahead of analysts' forecasts for a 1.5 million barrel drop, according to industry data from the American Petroleum Institute.

Official information from the US Energy Information Administration (EIA) is available on Wednesday at 10:30 am EDT (1430 GMT).

"Investors are also convinced that (official) inventories in the United States will decrease this week," ANZ Bank said in a note.

Signs of slowing US crude oil production growth and a weaker US dollar also fueled some oil price support, said Kim Kwangrae, commodity analyst at Samsung Futures in Seoul.

The US dollar index .DXY against a basket of six major currencies fell to 95,211 on Wednesday after losing 0.7 percent less last day, weighed by US President Trump's comments on monetary policy.

A weaker US dollar makes oil, priced in dollars, less expensive for buyers in other currencies.

The US Energy Information Administration last week lowered its production growth in the United States in 2018 to 10.68 million barrels per day (bpd), of 10.79 million bpd amid lower crude prices.

Concerns also remain as to how much oil will be removed from the global markets by renewed sanctions against Iran, despite concerns that demand growth may weaken as a result of trade disputes between the United States and China, & # 39; two largest economies.

"The problem with Iran continues to occupy the spirit of traders," said Greg McKenna, market leader of the AxiTrader futures broker market.

Iran, member of the Organization of the Oil-exporting Countries (OPEC) and OPEC's third-largest oil producer, said earlier this week that no other OPEC member could take over its share in oil exports.

Meanwhile, there is a Chinese trade delegation in Washington to discuss trade disputes with the American side. But signs of a thaw were unlikely, as US President Donald Trump Reuters said in an interview on Monday that he did not expect much progress.

Reporting by Jane Chung; editing by Richard Pullin

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