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UPDATE 3-Oil firm on tightening Iran sanctions, but surging U.S. supply holds back prices
* Sanctions have cost Iran $10 bln in oil revenue -U.S. official
* U.S. crude stocks at Oct 2017 high of 460.63 mln barrels -EIA
* U.S. crude oil production at record 12.2 mln bpd -EIA
* Asia struggling with economic slowdown
* U.S. oil output, inventory, drilling: https://tmsnrt.rs/2DwTUBQ (Recasts on higher prices, adds U.S. comment on Iran sanctions
SINGAPORE, April - Oil prices were firm on Thursday, supported by tightening sanctions against Iran announced this week but held in check by a surge in U.S. supply and concerns of an economic slowdown.Brent crude futures were at $74.74 per barrel at 0622 GMT, up 17 cents, or 0.2 percent, from their last closeU.S. West Texas Intermediate (WTI) crude futures at $65.89 per barrel, unchanged from their previous settlement.Crude futures rose to 2019 highs earlier in the week after the United States said it would end all exemptions for sanctions against Iran, demanding countries halt oil imports from Tehran from May or face punitive action from Washington.
U.S. decision to toughen its sanctions on Iran ... we have revised up our end-year forecast for Brent crude from $50 to $60 per barrel," analysts at Capital Economics said in a note.U.S. sanctions against Iran have denied its government more than $10 billion in oil revenue since President Donald Trump first announced the move last May, a U.S. official said on Thursday during a media call."Before sanctions ... Iran generated as much as $50 billion annually in oil revenue. We estimate that our sanctions have already denied the regime more than $10 billion since May (2018)," said Brian Hook, U.S. Special Representative for Iran and Senior Policy Advisor to the Secretary of State. U.S. decision to try and bring down Iran oil exports to zero comes amid supply cuts led by producer Organization of the Petroleum Exporting Countries (OPEC) since the start of the year aimed at propping up prices. a result, Brent prices have risen by almost 40 percent since January.
Still, Hook said "there is plenty of supply in the market to ease that transition and maintain stable prices".Capital Economics said it expected "oil prices to fall this year as sluggish global growth weighs on oil demand, U.S. shale output grows strongly and investor aversion to risk assets like commodities increases".South Korea's economy unexpectedly shrank in the first quarter, the Bank of Korea said on Thursday, marking its worst performance since the global financial crisis. Premier Li Keqiang said on Wednesday that his nation's economy "still faces downward pressure". the supply side, U.S. crude oil production C-OUT-T-EIA has risen by more than 2 million barrels per day (bpd) since early 2018 to a record of 12.2 million bpd currently, making the United States the world's biggest oil producer ahead of Russia and Saudi Arabia.In part because of soaring domestic production, U.S. commercial crude oil inventories C-STK-T-EIA last week hit a October 2017 high of 460.63 million barrels, the Energy Information Administration said on Wednesday. That was a rise of 1.3 million barrels. GRAPHIC: U.S. oil drilling, production & storage levels
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