Oil Drops Nearly 3 Percent on Oversupply Worries

Oil plunged Thursday, with U.S. crude dropping almost 3 percent as the market grappled with oversupply fears as increased U.S. sanctions on Iran had more gradual impact than expected and U.S. crude oil inventories rose sharply. U.S. crude settled down $1.79 or 2.8 percent at $61.81 a barrel, heading for its biggest weekly fall since February. Brent crude futures fell $1.43 a barrel, or 2 percent to $70.75. Market sentiment became more bearish as shifting U.S. policy on Iran had less immediate impact than initially feared, analysts said. The U.S. sanctions on Iran intensified this week as the Trump administration halted waivers allowing eight countries including China and Turkey to continue to do business with Iran. The roll-back of the waivers did not immediately lead to supply shortages. China has complained to the United States about its Iran sanctions and Turkey said it was unable to replace Iranian imports easily, calling on Washington to review its move. Reuters

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