Oil Price Jumps as US Plans to Tighten Iran Sanctions

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Ejiofor Alike with agency reports

Crude oil jumped almost three per cent yesterday after the United States said it will tighten a clamp-down on Iranian oil exports in May.

The United States said it will eliminate in May all waivers that allowed eight countries to buy Iranian oil without facing US sanctions, a move that sent oil price to 2019 high.

At the early trading yesterday, oil topped $74 per barrel, the highest since November 2018, as the United States announced a further clampdown on Iranian oil exports, raising concern of tighter global supplies.

But later in the day, Brent crude, the global benchmark, rose as much as 3.3 per cent per barrel and was last up $1.98 to settle at $73.95.

The US West Texas Intermediate crude climbed by as much as 2.9 per cent to $65.87, the highest since October 31.

WTI was up $1.48 to $65.48 per barrel.

Reuters reported that another drop in Iranian exports would further squeeze supply in a market already tightened through the United States sanctions against Iran and fellow OPEC member, Venezuela, plus voluntary cuts led by the Organisation of the Petroleum Exporting Countries (OPEC).

In November 2018, the United States re-imposed sanctions on exports of Iranian oil after President Donald Trump unilaterally pulled out of a 2015 nuclear accord between Iran and six world powers.

Washington, however, granted waivers to Iran’s eight main buyers – China, India, Japan, South Korea, Taiwan, Turkey, Italy and Greece – that allowed them to continue making limited purchases for six months.

But the US Secretary of State Mike Pompeo yesterday reiterated that Washington’s goal was to bring down exports of Iranian oil to zero and added that the United States had no plans to give any grace period beyond May 1 for countries to comply.

An end to the exemptions would hit Asian buyers hardest. Iran’s biggest oil customers are China and India, both of which have been lobbying for an extension to the sanction waivers.

Trump said Saudi Arabia and other OPEC nations could “more than make up” for any drop in Iranian oil supplies. OPEC and allies led by Russia have been cutting production in 2019 to support the market.

Saudi Arabia said it would coordinate with other producers to ensure an adequate crude supply and a balanced market following the US announcement.

Meanwhile, major financial markets in Europe were closed for Easter Monday, as were markets in Australia and Hong Kong.

Benue Govt Imposes Curfew on Katsina-Ala

The Benue State Government yesterday imposed a 24-hour curfew on Katsina-Ala town in Katsina-Ala Local Government Area (LGA) of the state.

This is contained in a statement signed by the Chief Press Secretary to the Acting Governor, Mr. Ede Ogaba, and made available to the News Agency of Nigeria (NAN) in Makurdi, the state capital.

Ogaba said the curfew, which is with immediate effect, would be reviewed as the situation demands.

“The Benue State Government has imposed a 24-hour curfew on Katsina-Ala with effect from today (Monday), April 22, as part of efforts to restore peace and ensure the security of lives and property in that part of the state,” he said.

Ogaba quoted the acting governor, Benson Abounu, as urging the people of the area to cooperate with security operatives by obeying the curfew.

“Government warns that anyone found fomenting trouble in the area or in other parts of the state will be apprehended and punished according to law.

“Government reassures the people that more security personnel have been deployed to Katsina-Ala to end the crisis, and it will continue to give security agencies every needed support to succeed,” he said.