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Multiple media outlets, lead by the Washington Post, first reported that President Donald Trump will end waivers that have allowed eight nations -- including China and Japan -- from purchasing crude from Tehran without fear of sanctions. The waivers, which were granted in November of last year, are set to expire on May 2. Those reports were confirmed early Monday.

"President Donald J. Trump has decided not to resissue Significant Reduction Exceptions (SREs) when they expire in early May," the White House said in a statement. "This decision is intended to bring Iran's oil exports to zero, denying the regime its principal source of revenue."

"The United States, Saudi Arabia, and the United Arab Emirates, three of the world's great energy producers, along with our friends and allies, are committed to ensuring that global oil markets remain adequately supplied. We have agreed to take timely action to assure that global demand is met as all Iranian oil is removed from the market."

Saudi Arabia and others in OPEC will more than make up the Oil Flow difference in our now Full Sanctions on Iranian Oil. Iran is being given VERY BAD advice by @JohnKerry and people who helped him lead the U.S. into the very bad Iran Nuclear Deal. Big violation of Logan Act?

— Donald J. Trump (@realDonaldTrump) April 22, 2019

Brent crude contracts for June delivery, the global benchmark for oil prices, were marked $1.75 higher from their Thursday close in New York and changing hands at $73.72 per barrel while WTI contracts for the same month were seen $1.42 higher at $65.49 per barrel.

The Iran waivers are the latest in a series of events that have choked global supply and lifted prices from the 18-month nadir they reached on Christmas Eve. Since the, Brent crude has gained 45.6% and U.S. oil prices have surged 54%.
 
"So much for the US administrations tango with the Iran 'waiver or not to waiver'," said Stephen Innes of SPI Asset Management. "No more waivers: The United States will try to force Iranian oil exports to zero. Predictably oil prices are rising, but this leads into the broader question, given the tenuous relationship between Saudi Arabia and Iran, not to mention the signs of aggression emanating out of Washington, are we going to see the middle east powder keg explode again?"
 
OPEC, along with allies such as Russia, have reduced their collective output by around 1.98 million barrels per day from the levels recorded in October of last year, while U.S. sanctions on the sale of crude from Venezuela has reduced that country's exports by around 310,000 barrels per day.
 
ING's head of commodities strategy, Warren Patterson, thinks one of the bull market's key risks at the moment is whether OPEC members, along with their allies, extend their agreed production cuts into the second half of the year when they meet in Vienna later this spring.

"Another risk is that we see OPEC production edging higher as we move towards the summer, in order to meet domestic cooling demand over the hotter months," he added. "A key bullish factor since the start of the year has been Saudi Arabia's over compliance with the output cut deal. If this were to start slipping moving forward, it would call into question overall OPEC+ compliance with the deal."