Oil backs off four-year highs as dollar gains ground

Oil futures fell in American trade to early October lows as the dollar index inched up, as the US market shuts down for the Columbus Day bank holiday. 

As of 05:59 GMT, US crude futures due in November rose 0.42% to $74.03 a barrel, while Brent December futures rose 0.57% to $83.68 a barrel, as the dollar index climbed 0.20% to 95.82. 

Reports came out that the US administration is studying possible exemptions for the ban on Tehran's oil exports, expected to go into full effect in November, out of fear of causing a surge in prices due to supply shortages. 

Iranian oil minister Bijan Namdar Zangeneh warned in earlier remarks that Saudi Arabia won't be able to compensate for the expected drops in supplies due to US sanctions on Iran, causing market imbalance. 

Last week, US national security adviser John Bolton said the Trump administration is aiming to completely stop Iranian oil exports, calling for the entire world to refrain from purchasing Iranian oil to heap pressure on the country regarding their nuclear program and interference with the region's internal affairs. 

Otherwise, Russian energy minister Alexander Novak said last week the global oil market is relatively balanced, even though existing uncertainties could still push prices higher, mainly because of US sanctions on Iranian oil exports. 

Oil prices are up 20% so far this year as OPEC and Russia carry on their agreement to cut global output to easy a previous supply glut, while the US withdrew from the Iran deal and sanctioned their oil exports.

US Oil Rig Count 

Baker Hughes, a US oil services company, reported a drop of two rigs in the oil rig count to a total of 863 rigs, the third weekly increase in a row. .

US output has recently risen to the second highest in the globe, taking the place of Saudi Arabia while Russia continues at the top with 11.21 million bpd.