Oil prices drop below $30 as Iran gets closer to crude exports

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HOUSTON — Crude prices tumbled below $30 a barrel on Friday, alongside a steep plunge in global stocks, as traders watched for signs Iran will pass a final regulatory test to put its oil exports back into oversupplied global markets.

Markets expect the International Atomic Energy Agency, after a meeting in Vienna on Friday, will confirm Iran has complied with its end of the nuclear agreement, in which the Islamic Republic guaranteed constraints on its nuclear program in exchange for the lifting of western sanctions on its

“They’re pricing in something between 500,000 and up to 1 million barrels a day,” said Andy Lipow, president of oil consultancy Lipow Oil Associates in Houston. “If Iran has complied with the nuclear court, the sanctions could be lifted this weekend.”

U.S. crude fell $1.78 to $29.42 a barrel on the New York Mercantile Exchange, a 20-percent drop from the beginning of the year. Brent, the global benchmark, fell 95 cents to $29.93 a barrel on the ICE Futures Europe.

Meanwhile, the Dow Jones Industrial average fell more than 300 points as markets opened. The Standard & Poor’s 500 Index also plunged 1.8 percent, erasing gains from the previous day.

Diplomats from the United States and five other Western powers signed a nuclear accord with Iran in Vienna in July. Iranian officials have often said they aim to produce 500,000 additional barrels a day but have recently said they will watch the market to time the Islamic Republic’s return to the market correctly.

Lipow said it’s possible Iran, which will have access to $100 billion in frozen assets after sanctions are lifted, will wait until oil prices rise again before restarting their exports.