The US government has introduced financial sanctions against Iran which, beginning in November, also target the petroleum sector of OPEC's third-largest producer.
The US Department of Energy (DOE) is offering 11 million barrels of crude for sale from the nation's Strategic Petroleum Reserve (SPR) ahead of sanctions on Iran that are expected to reduce global supplies of crude.
The delivery period for the proposed sale of sour crudes will be from Oct. 1 through Nov. 30, according to Monday's notice.
The US government has introduced financial sanctions against Iran which, beginning in November, also target the petroleum sector of OPEC's third-largest producer.
The sale appears to be designed to show the Trump administration is taking measures to restrain energy price increases ahead of the sanctions, one crude trader told Reuters.
US crude was up by 45 cents at $66.36 a barrel in afternoon trading on Monday.
As a shale boom helped domestic oil production hit an all-time record this year, US lawmakers increasingly have viewed oil-reserve sales as a way to reduce deficits and fund government operations.
US President Donald Trump earlier this year complained that oil prices are "artificially very high" and a potential release from the SPR, ahead of the US midterm elections in November, was widely seen as a way to bring relief to motorists who have seen gasoline prices jump in the past year.
However, American drivers are unlikely to see prices at the pump fall by crude releases from the SPR because US oil production already is sky high, analysts have said.
Earlier this year, the DOE sold about 5.2 million barrels of oil from the SPR to five companies including top refiners Valero Energy Corp and Phillips 66.
Offers from the latest sale are due at 2:00 p.m. Central Time, August 28, the notice said.
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