Oil prices fell on Tuesday after Saudi Arabia said it would play a "responsible role" in energy markets, although sentiment remained nervous ahead of new US sanctions on Iran's
crude exports that start next month.
crude oil was down 55 cents a barrel at $79.28 by 0735 GMT. US light crude was 35 cents lower at $69.01.
The US sanctions on Iranian oil begin on Nov. 4, and Washington has said it wants to stop all of Tehran's fuel exports.
Saudi Arabia says it will keep markets supplied despite its increasing isolation over the killing of Saudi journalist Jamal Khashoggi, and there are signs that
crude exports from the Middle East are rising.
There has been some concern that Saudi Arabia might cut
crude supply in retaliation for potential sanctions against it over the Khashoggi killing.
Saudi Energy Minister Khalid al-Falih said on Monday that "there is no intention" to do that, and that Saudi Arabia would play a "constructive and responsible role" in world energy markets.
Economist Intelligence Unit energy analyst Peter Kiernan said it would be self-defeating for Saudi Arabia to cut oil supply as it would "risk losing market share to other exporters while losing its reputation as a stable actor in the market".
Despite this, Sukrit Vijayakar, director of energy consultancy Trifecta, said "markets are ... wary of the impact of US sanctions on Iran's oil sector", estimating sanctions "could impact up to 1.5 million barrels per day of supply".
crude imports from Iran fell to zero in September, data from state-run Korea National Oil Corp showed on Tuesday.
JPMorgan said in a note dated Oct. 19 that it raised its 2019 Brent price forecast by $20.50 a barrel to $83.50, saying its "bullish argument is strongly driven by tighter supply due to Iranian sanctions and declining spare capacity".
Not everyone is so bullish. Shipping brokerage Eastport said
crude prices were "expected to decline in coming months, as rising production in the U.S. offsets increasing global demand".
USReflecting a cautious outlook, traders have been curbing their exposure to oil markets by shutting long positions in
crude oil production has climbed by almost a third since mid-2016 to around 11 million barrels per day, and rising drilling activity points to further increases. crude futures, with fund managers cutting their combined positions by 187 million barrels in the last three weeks, according to exchange and regulatory data.