On Wednesday, the global benchmark hit a late 2014 high of $86.74.
Friday marked the end of a particularly volatile week for crude that saw one massive uptick, one massive loss, and everything in between, and culminating in flat trading for the Brent and West Texas Intermediate benchmarks - with traders obsessed over what market impact the us sanctions against Iran will have when they come into effect in November. China, too, attempted in March to launch crude futures contracts in local currency to circumvent USA sanctions barring Tehran access to the greenback. Brent crude was up 40 cents to $85.20 a barrel at 4:51pm (Oct 3) in London.
Many analysts said they expected Iranian exports to drop by around 1 million barrels per day.
US West Texas Intermediate (WTI) crude futures rose 1 cent to settle at $74.34 a barrel.
Secretary of State Mike Pompeo announced on Wednesday the termination of the US and Iran's 1955 Treaty of Amity, Economic Relations, and Consular Rights following Iran's use of the document as justification to take the U.S.to the United Nations' International Court of Justice (ICJ) over sanctions imposed by the Trump administration.
Oil capped the longest run of weekly gains since the start of this year amid concern that Saudi Arabia and Russian Federation might not pump enough crude to prevent a supply crunch as Iranian cargoes disappear from world markets.
On a related matter, Reuters reported on October 5 that Indian crude importers intend to keep buying oil from Iran in November after USA sanctions go into effect and are seeking a waiver from the sanctions from Washington.
Meanwhile, the US Energy Information Administration (EIA) reported a huge increase in weekly crude oil inventories.
"It now appears that only China and Turkey may be willing to risk USA retaliation by transacting with Iran", Jefferies said. US State Department Legal Advisor Jennifer Newstead argues that Iran's request is not within the court's jurisdiction.
Indian buyers instead lifted purchases of Iranian crude to 502,000 bpd in the month, up 111,000 bpd over August, said Reuters which had already claimed that India was cutting Iran oil imports.
India had planned to import about 25 million tons of crude oil from Iran in the current fiscal, up from 22.6 million tons imported in 2017-18.
"The Saudis won't flood the market and they don't want to see it oversupplied", said Giovanni Staunovo, an analyst at UBS Group AG.