Iran Sanctions Threaten Oil Supplies and Prices

Oil prices have dropped significantly as investors take profits ahead of an expected announcement from Washington about imposing new sanctions on Iran. The US Treasury Secretary is set to hold a press conference today, where he will discuss 'the toughest sanctions in history' on Iran.

The Brent crude futures fell $1.23, or 1.3%, to $93.16 by 0329 GMT, while US West Texas Intermediate crude was at $85.7 a barrel, down $1.36, or 1.6%. These prices represent the second weekly gains for both contracts last week.

The threat of new sanctions has disrupted oil supplies from the Middle East, with some analysts expecting the recovery to take even longer than expected. Morgan Stanley analysts have slowed their assumption for a recovery in Middle East supplies, citing 'one of the sharpest declines in oil-on-water' and declining onshore inventories.