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Oil gains on easing trade war concerns, sanctions on Iran

Reuters  |  NEW YORK 

By Stephanie Kelly

NEW YORK (Reuters) - futures rose on Monday after weeks of declines, as investors grew more concerned about an expected fall in supply from due to U.S. sanctions and worried less that a trade war between the and would hurt economic growth.

Brent crude futures rose 38 cents to settle at $72.21 a barrel, a 0.5 percent gain.

U.S. Intermediate (WTI) crude rose 52 cents, or 0.8 percent, to end at $66.43 a barrel.

Last week, Brent declined for a third consecutive week, while WTI fell for a seventh week due to concerns that economic growth would slow because of U.S.-Chinese trade tensions and weakness in emerging economies.

and the will hold trade talks this month, the two governments said last week, hoping to resolve an escalating tariff war between the world's two largest economies.

Still, said should not underestimate Donald Trump's resolve.

"Part of the weakness we've seen in has largely been due to trade as people are concerned that increasing tariffs and tensions on trade are going to increase the level of uncertainty and potentially reduce global GDP demand," said Brian Kessens, at

"Anything that reduces those tensions, you can see generally move back the other way."

Traders said U.S. sanctions against were supporting prices. The has introduced financial sanctions against which, from November, will also target the petroleum sector of OPEC's third largest

On Monday, Iran asked the to speed up efforts to save a 2015 nuclear deal between and major powers, which Trump abandoned in May. Most EU companies have pulled out of Iran for fear of U.S. sanctions and said France's Total had officially exited Iran's South Pars

"The Iranian sanctions will likely remain as a latent bullish force for another month or so until more definition is provided with regard to the impact on the country's oil exports," Jim Ritterbusch, of Ritterbusch and Associates, said in a note.

signalled it wanted to continue buying large volumes of Iranian oil despite U.S. pressure and was now switching to Iranian tankers to skirt U.S. sanctions on ship insurers.

The (DOE) is offering 11 million barrels of crude for sale from the nation's Strategic Petroleum Reserve (SPR) ahead of the sanctions on Iran. The sale appears to be designed to show the is taking measures to restrain ahead of the sanctions, one told

Elsewhere, crude exports rose to 7.240 million barrels per day in June, official data showed.

(Reporting by in New York; Additional reporting by in Singapore and Dmitry Zhdannikov in Moscow; Editing by and Frances Kerry)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, August 21 2018. 00:59 IST