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Oil slips as U.S. sanctions on Iran begin, Tehran defiant

Reuters  |  LONDON 

By Christopher Johnson

LONDON (Reuters) - prices fell on Monday as U.S. sanctions against Iran's fuel exports were softened by waivers allowing major buyers to import Iranian crude for a while, while Tehran said it would defy and continue to sell.

Brent was down 25 cents a barrel at $72.58 by 1130 GMT. U.S. light crude was 35 cents lower at $62.79 a barrel.

Both benchmarks have lost more than 15 percent since hitting four-year highs in early October, as hedge funds have cut bullish bets on crude to a one-year low.

imposed sanctions against on Monday, restoring measures lifted under a 2015 nuclear deal negotiated by the administration of former U.S. Barack Obama, and adding 300 new designations including Iran's oil, shipping, insurance and sectors.

In response, Iranian said in a speech broadcast on state TV that would break the sanctions and continue to sell oil.

And said on Friday it will temporarily allow eight importers to keep buying Iranian oil.

"U.S. sanctions against ... created serious concerns with traders earlier in September. But they are turning into a damp squib," said Fiona Cincotta, at City Index.

Washington has so far not identified the eight. China, India, South Korea, Turkey, Italy, the and have been the top importers of Iran's oil, while also occasionally buys Iranian crude.

said on Monday it had been granted a waiver, at least temporarily, to import condensate, a super-light form of crude oil, from Iran. It was also allowed to continue financial transactions with the country, it said.

China's foreign ministry expressed regret at the U.S. decision but would not directly say if had or had not been granted an exemption.

have been anticipating the sanctions for months and the world's biggest producers have been increasing output.

Joint output from Russia, the and rose above 33 million barrels per day (bpd) for the first time in October, up 10 million bpd since 2010, with all three pumping at or near record volumes.

In the Middle East, the plans to increase its to 4 million bpd by the end of 2020 and to 5 million bpd by 2030, it said on Sunday, from output of just over 3 million bpd.

(Reporting by in London and Henning Gloystein in Singapore; editing by and Louise Heavens)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

First Published: Mon, November 05 2018. 17:21 IST