Brent crude oil dipped back below the $30 per barrel mark today, as the prospect of more Iranian oil looms over an already oversupplied market.
Brent crude, the global benchmark, shed 3.5 per cent to $29.89 per barrel this morning. Meanwhile, West Texas Intermediate (WTI) crude, the US benchmark, shed 5.05 per cent to $29.62.
"It was definitely a case of stop-loss selling as both WTI and Brent simultaneously crashed through the $30 barrier. Both contracts had broken below this level before, but not at the same time," David Morrison, senior market strategist at Spreadco, said.
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Brent is heading for a weekly loss of around 10 per cent, while WTI looks set to shed around eight per cent.
Western sanctions on Iran are expected to be lifted within days, potentially paving the way for more crude oil exports from the country, under a landmark agreement on Tehran's disputed nuclear program.
"This is three or four months ahead of what the market was thinking last year, so it just adds fuel to the fire," said Tony Nunan, Oil risk Manager, Mitsubishi Corp in Tokyo.