Oil edges back from big slump as Iran sanctions return to focus

US issues warning to Russia about helping Iran escape upcoming oil sanctions

In post-settlement trade, prices extended losses, as data from the American Petroleum Institute (API) showed a large increase in United States crude inventories.

Crude fell sharply in the previous session, with Brent closing down 4.3 percent.

The Saudi Energy Minister attempted to alleviate concerns over a potential supply shock from Iranian sanctions set to be imposed next month through implying a 1-2mbpd increase in oil production from current levels (10.5mbpd).

U.S. West Texas Intermediate (WTI) crude futures were at $66.58 a barrel, up 15 cents, or 0.2 percent, from their last settlement. The market bounced around during the day, posting gains into the early afternoon before pulling back. The 10-year average level of production was 2.3 million barrels per day.

Brent crude - the world benchmark - was up 31 cents at $76.62 USA a barrel.

"Saudi Arabia produces only what its customers ask for, not more".

Oil prices have steadied after hitting low of $75 per barrel this morning, following yesterday's four per cent price dive amid a continuing political crisis in Saudi Arabia. A Bloomberg survey of analysts has estimated the increase at 3.7 million barrels.

USA commercial crude oil stockpiles rose for a fifth consecutive week last week, increasing by 6.3 million barrels to 422.79 million barrels, the Energy Information Administration said on Wednesday.

Futures in NY dropped as much as 1.2 percent after a 0.6 percent gain on Wednesday.

But the Center says gasoline prices could fall next week, as crude prices are on a downward trend following recent plunges in stock markets around the world.

Refining utilization rose modestly.

In equity markets, the MSCI Asia Pacific Index dropped as much as 2.4 percent on Thursday, taking its slide from a January peak to more than 20 percent.

The executive director of the International Energy Agency (IEA), Fatih Birol, said on Monday that other producers may struggle to fully make up for the expected Iran disruption and that oil prices could rise further.

A sell-off in equities due to concern about the economic outlook also weighed on crude on Tuesday.

The United States can not stop Iranian oil exports by imposing sanctions on Tehran, Iran's oil minister said on Tuesday, warning that such restrictions will ensure the market remains volatile.

Saudi Energy Minister Khalid al-Falih told a conference in Riyadh on Tuesday the oil market was in a "good place" and he hoped oil producers would sign a deal in December to extend cooperation to monitor and stabilise the market.