Iran erupts as U.S. oil sanctions return

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Oil prices dipped on Monday as the start to US sanctions against Iran's fuel exports was softened by waivers that will allow some countries to still import Iranian crude, at least temporarily.

Iranian President Hassan Rouhani has vowed to sell his country's oil and break the sanctions.

"The last set of sanctions lifted under the bad nuclear deal will come back into force, including powerful sanctions on Iran's energy, shipping, and shipbuilding sectors, and sanctions targeting transactions with the Central Bank of Iran and sanctioned Iranian banks", the president said.

Trump said the deal was weak and favoured Iran.

"All eyes will be on the outcome of negotiations on possible waivers to US sanctions on Iran".

"The effect of the initial sanctions is already being felt - the [local currency] is at a low, Iran's economy is at a low and we're already seeing results on the ground", he said in video message posted Saturday.

Pompeo wouldn't say if India and China are receiving waivers, or if they'd delivered commitments to stop their buying.

"Saudi Arabia can produce 12 million barrels a day, but only if it invests", said Hancock, noting that the country now produces just under 11 million barrels a day. "They will definitely have a gradual escalating impact on economic conditions and, subsequently, on the relations between Iran and the US". The waiver would be granted for six months period and then would be re-evaluated by the United States, Special US Representative on Iran, Brian Hook told reporters.

Switzerland said it was holding talks with the United States and Iran about launching a humanitarian payment channel to help food and drugs keep flowing to Tehran. "We do not recognize the sanctions introduced unilaterally without the United Nations, we consider those methods illegal per se", he said.

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Before travelling to a campaign rally for the U.S. mid-term elections, President Donald Trump said Iran was already struggling under his administration's policies.

The new wave of sanctions, the second since August, will target Iran's energy, shipbuilding, shipping, and financial sectors.

The Trump administration is restoring all sanctions lifted under the 2015 nuclear deal in a bid to pressure Iran. He qualified that transactions for "humanitarian" purposes would be exempt, as they had been in the past, but cautioned that "banks must be very careful that these are not disguised transactions".

Secretary of State Mike Pompeo and Treasury Secretary Steven Mnuchin are due to provide more details about the sanctions at a morning news conference.

India, the world's third-biggest oil consumer, meets more than 80 per cent of its oil needs through imports.

U.S. West Texas Intermediate (WTI) crude futures CLc1 were down 35 cents, or 0.6 percent, at $62.79 a barrel.

"We believe that China's normal cooperation (with Iran) within global law is legal and legitimate, and this shall be respected".

Secretary of State Michael Pompeo is scheduled to announce the list of eight countries that will get temporary waivers to keep importing Iranian oil at 8:30 a.m. Washington time on Monday.

"That's the goal, that's the mission, and that's what we will achieve on behalf of the president".

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