Crude oil prices retreated in Wednesday trading after a downbeat report from the International Monetary Fund on Greece and clamoring over Iran's oil potential.
The Greek Parliament is considering the latest assistance measure from international lenders after the majority of Greek voters said no in a referendum to help from European and international lenders.
German Chancellor Angela Merkel cautioned the protracted "situation is comparatively serious," calling on the Greek government to provide "extremely detailed proposals" for assistance.
Greek debt cast a shadow over the latest international financial crisis, though European leaders said the region's economy would be able to weather the storm. A report from the International Monetary Fund said the latest Greek debt issue would only be managed through debt relief measures "that go far beyond what Europe has been willing to consider so far."
West Texas Intermediate, the U.S. benchmark, was down 1 percent to $52.50 per barrel in early Wednesday trading, down more than 10 percent for the month. Brent crude oil prices lost slightly more than a full percentage point to $57.89 per barrel, down 8 percent since July 1.
Investors, meanwhile, were focused on the oil production and export potential from Iran now that world powers agreed to ease sanctions pressure as part of a sweeping nuclear agreement. Mohsen Qamsari, director of international affairs at the National Iranian Oil Co., said Iran would work to maximize its crude oil export capacity to pre-sanctions levels of around 2 million barrels per day.
A policy paper from the IMF said most of the drop off in crude oil prices is because of supply issues, stemming in large part from oil production from shale basins in the United States. More Iranian crude oil could, in theory, push markets further toward the supply side and put even more downward pressure on the price of oil.
The Iranian director stressed Asia is the top priority for future export markets given its proximity to Iran. Any talk of a surplus in supply, he cautioned in statements published by the Iranian Oil Ministry's website, Shana, is "media hype" that shouldn't be given too much credibility.
