Iran says oil market held "hostage" by Saudi Arabia, Russia

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This, the official warned, could eventually enable the member states of the Organization for Economic Cooperation and Development (OECD) to store more oil whereas one of the objectives of the deal was to prevent this from happening given that it could lead to the crash of oil prices internationally.

In its latest monthly oil report, the IEA warned that the oil market is entering a "very crucial period", highlighting continued output decline in Venezuela, this week's attack on the headquarters of Libya's NOC and a sharp reduction in Iranian output ahead of the reinstatement of U.S. sanctions on November 4. The pace of drilling slowed after oil prices tumbled starting in 2014, but roared back as operators learned to produce oil more efficiently and crude prices rebounded.

Leave aside concerns about prospects for developing economies and the impact of Trump's trade wars that are darkening the outlook for oil demand.

U.S. West Texas Intermediate (WTI) futures were up 11 cents at $68.70 a barrel after dropping 2.5 percent on Thursday.

Futures in NY increased as much as 0.5 percent, on course for a weekly gain of 1.6 percent.

Brent crude was up 17 cents at $78.35 a barrel at 1044 GMT.

"Prices remain well supported as the market continues to fret about ongoing structural supply issues elsewhere", ANZ Research said in a note.

Early in the week, traders were reacting to worries about tighter supply conditions once Washington's sanctions against Iran's crude oil exports kick in beginning in November, and stable us production due to a flattening of the rig count last week.

Traders also continued to watch for any impact on the energy market from Hurricane Florence.

The United States is renewing sanctions on Iran after withdrawing from a nuclear deal forged in 2015 between Tehran and world powers.

The energy information administration and the International Energy Agency, a global group of oil-consuming nations, had predicted that the USA would eventually pass Russian Federation and Saudi Arabia but possibly not until 2019. The first row of new sanctions against Iran were put in place in August, while more hard-hitting sanctions against the country's energy sector will take effect on November 4.

India lifted about 658,000 barrel of oil per day (bpd) from Iran in April-August, according to data obtained from trade sources by Reuters, and the cuts projected for September and October would drop the daily average over those two months by about 45 percent to 360,000-370,000 bpd.

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