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In 2019, forecasters such as the International Energy Agency say emerging-market crises and trade disputes could dent global demand while rising production from outside the Organization of the Petroleum Exporting Countries adds to supply.

Brent crude futures were down US$1.22, or 1.5 per cent, at US$81.87 a barrel by 0237 GMT.

BP is reportedly planning on a cycle of oil prices at $60 to $65 per barrel: "We've been through this period of really low prices and they're up again and we can't plan on these high prices right now", Dudley explained.

In a similar vein, Jeffrey Currie, global head of commodities research and partner at Goldman Sachs - which in recent weeks has expressed conflicting opinions about where the crude market is heading - told Bloomberg television that the forecasts of many analysts of crude reaching the triple digits due to the loss of Iranian exports is "not justified yet".

Falling US equity markets and a global risk-off environment also weighed on crude futures.

The other big factor in Vitol chairman's bearish forecast is that "no doubt about it-we're going to see demand destruction, sadly".

Michael made landfall on Wednesday along the Florida Panhandle as a Category 4 hurricane with winds measuring at 155 miles per hour (249 kph).

Companies turned off daily production of 718,877 barrels of oil and 812 million cubic feet of natural gas by midday on Wednesday, according to the federal offshore regulator, the Bureau of Safety and Environmental Enforcement (BSEE).

Iran's crude exports fell further in the first week of October, according to tanker data and an industry source, taking a major hit from USA sanctions and throwing a challenge to other OPEC oil producers as they seek to cover the shortfall.

One of the reasons for the additional demand for Saudi oil is that the crude arbitrage from the United States is shut so the Indian buyers have to turn to Middle Eastern barrels, said one of the sources.

About 44 percent of the Iranian oil volumes that arrived in India in September were originally meant for August lifting, the data showed.

Reports emerged in early September that India had given permission to state-owned refiners to import oil from Iran on Iranian tankers using Iranian-backed insurance, after the biggest Indian shipping company backed out of Iran voyages due to the USA sanctions.

OPEC in its monthly report, said world oil demand would increase by 1.36 million barrels per day (bpd) next year, marking a decline of 50,000 bpd from its previous estimate.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc.