Crude prices tested intraday lows in midmorning US trading Tuesday as the market digested further details of US sanctions waivers on major buyers of Iranian crude.
At 1552 GMT, ICE January Brent was down 98 cents at $72.19/b and NYMEX December WTI was down 84 cents at $62.26/b.
Crude price declines had slowed earlier in Tuesday trading, with WTI trading on either side of even soon after the US market open.
On Monday, Washington announced that it would issue 180-day waivers to eight major buyers of Iranian crude, allowing continued imports in the wake of US sanctions that took effect on Monday.
President Donald Trump said that the goal of the waivers was to mitigate upside price shock due to tighter supply post-sanctions.
"I could get the Iran oil down to zero immediately but it would cause a shock to the market," Trump said Monday. "I don't want to lift oil prices. As you've noticed, oil prices are going down very substantially despite the fact that already half of [Iran's] capacity is gone."
Details on exactly how the waivers scheme would be implemented were scarce immediately following the announcement, but on Tuesday, the market received further clarity on how much Iranian oil may stay on the market.
South Korea will be able to import around 4 million barrels/month of Iranian oil under its waiver, three South Korean sources familiar with the matter told S&P Global Platts on Tuesday.
Likewise, Japan Minister of Economy, Trade and Industry Hiroshige Seko said Tuesday that Japanese refiners would start preparing for the resumption of Iranian crude oil imports following the US announcement Monday that Japan was among eight countries receiving its sanctions waiver.
Products futures traced the oil complex lower.
NYMEX December ULSD was down 97 points at $2.1866/gal and NYMEX December RBOB was down 84 points at $1.6835/gal.
