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In the USA, a drop in crude inventories as signaled by the API data would be the first decline in four weeks.

At the same conference, India's PM Narendra Modi also sat down with ministers and chief executives of oil companies and sought a review of payment terms for crude oil supplies.

'You cannot keep the price low with slogans and intimidation, ' considered Zanganeh.

Saudi Arabia, of course, is a major oil producer.

In relevant remarks last week, Zanganeh dismissed Saudi officials' claims that the country could compensate for a loss of Tehran's supplies in the global market after the imposition of the USA sanctions.

Because of rising crude oil prices, retail prices in India are touching new highs.

Saudi Arabia, the world's largest oil producing nation, is preparing a slew of investments in India's energy sector. "We have invested tens of billions of dollars to build the spare capacity of 2-3 million barrels per day over years". In April, prior to President Trump's announcement of the USA withdrawal from the multi-lateral nuclear deal with Iran, Iran exported 2.5 million bpd.

But Jahangiri's remarks are indirect acknowledgment that Iran's oil exports have been effectively cut in half from a peak of about 2.5 million barrels a day in April as customers fled in anticipation of the US sanctions.

Teen kills 18 students in Crimea college shooting
Kremlin spokesperson Dmitry Peskov said Wednesday that the possibility that this was a terror attack "is being considered". Russian Federation has annexed Crimea from Ukraine in 2014, a move that triggered Western sanctions.

Wayne Gordon, executive director for commodities and FX at UBS Global Wealth Management, told CNBC that the market is moving into unchartered territory because any oil production from Saudi Arabia above 11 million bpd (which is widely viewed as necessary to offset Iranian losses due to the USA sanctions) is "largely untested", even though he believes capacity globally "will start to ramp up next year".

Saudi Arabia denies that it had any role in Khashoggi's disappearance.

Sanctions or not, Iran would take advantage of any slowing of Saudi production, analysts said.

According to the EIA, US oil stocks rose by 6.5 million barrels, while oil exports fell to 1.8 million barrels per day. Meanwhile, President Donald Trump and his top diplomat cautioned against putting the entire U.S. -Saudi relationship at risk over dissident writer Jamal Khashoggi.

"The weakening crude spreads nearly globally in the face of Iran sanctions is likely generating some concern on how strong market really is and if it's ready to rally more", said Scott Shelton, energy futures broker with ICAP in Durham, North Carolina. The price of gasoil and gasoline sold through that network is on a par with that of state fuel retailers, Srikanth said.

Investors worry Saudi Arabia could use oil supply to retaliate against critics.

Tensions over Saudi Arabia have eased as U.S. Secretary of State Mike Pompeo said that the kingdom promised a "transparent investigation" into the disappearance and alleged killing of a prominent journalist.