Oil dips as USA grants Iran sanctions waivers; Tehran defiant

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After sanctions were re-imposed on Iran following the withdrawal of US from the nuclear deal, US Secretary of State Mike Pompeo said eight countries will be temporarily exempted from the ban on buying crude oil from Iran so as to not disrupt their energy needs.

The measures taking effect Monday restore all the sanctions that had previously been lifted under the accord, which had given Iran billions of dollars in sanctions relief in exchange for curbs on its nuclear program. "Exempting eight countries from the US sanctions means Iranian oil will continue to flow and there's no longer risk of a supply shortage", he said.

The US granted the waiver to eight countries, including China and India, the biggest buyers of Iranian oil, to keep crude oil prices stable. "We continue negotiations to get all of the nations to zero".

Mr. Trump called the Obama-era nuclear deal with Iran the "worst ever" agreement stuck by the U.S. But the other parties to the deal - Britain, France, Germany, China and Russian Federation - stuck with it.

Dubowitz added, "They don't want all the Iranian oil off the market November 5, because that would spike the price and send additional revenues to Iran".

The sanctions hit oil exports, shipping and banking.

Earlier Monday, Israeli Defence Minister Avigdor Lieberman called the new sanctions a "critical" blow to Iran's actions in the region.

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"We are making it abundantly clear to the Iranian regime that they will face mounting financial isolation until they fundamentally change their destabilizing behavior", Mnuchin told reporters. The price pressure on oil has scared off financial traders.

South Korea, one of Asia's biggest buyers of Iranian oil, last week asked the USA for "maximum flexibility" after some of its construction firms cancelled energy-related contracts in the Islamic Republic because of financing difficulties.

Front-month Brent crude futures, the global benchmark for oil prices, were at $72.53 United States per barrel on Monday. "Therefore, we will proudly break the sanctions".

Lord Lamont said a major concern was whether humanitarian supplies could reach the Iranian people, despite the U.S. saying these would be allowed.

Senior Iranian officials have dismissed concerns about the impact to its economy. China has publicly defied the USA call for curbs on oil imports from Iran.

The resumption of sanctions is intended "to compel Iran to permanently abandon its well-documented outlaw activities and behave as a normal country", according to Pompeo.

US officials did not immediately make an announcement as the sanctions took force in the early morning hours of November 5, part of Washington's effort to ramp up pressure on Tehran to "change its behavior" and end what the United States says is its "malign" activities in the region.