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Iranian President Hassan Rouhani. Photo: Luiz Rampelotto/NurPhoto via Getty Images

Oil sanctions stemming from President Trump's withdrawal from the Iran nuclear deal officially went into effect Sunday at midnight, triggering immediate condemnation from Iranian President Hassan Rouhani, who pledged to continue exporting oil in defiance of the Trump administration's "economic war," reports the AP.

The big picture: Prices this morning show Brent barely moving off prices that have tumbled sharply in recent weeks, trading at $73.11. This reflects how the reductions in Iranian exports have been ongoing and are largely priced into the market. Traders are also responding to today's announcement that the U.S will grant temporary waivers to 8 "jurisdictions" — China, India, Italy, Greece, Japan, South Korea, Taiwan and Turkey — that buy Iranian oil but, according to the State Department, have moved to curb imports.

What they're saying: “The impact of the sanctions is going to be largely softened as a result of this allowance,” Surfeit Vijayakar of the energy consultancy Trisect tells Reuters.

  • In addition, bearish forces like potentially softening demand growth and U.S.-China trade tensions are affecting the price (we looked more deeply at the state of the market in Friday's edition).

What's next: Iranian exports have fallen by about a million barrels per day in the run-up to the formal reimposition. The consultancy Wood Mackenzie, in a note Monday morning, said that even though some other producers have stepped up production, the market could get a lot tighter in coming months as sanctions continue driving down exports.

  • “We think there’s just enough growth in supply from elsewhere to muddle through the next few months, meet winter demand and avert a price spike," said WoodMac's Ann-Louise Hittle.
  • She notes that OPEC's spare capacity that can be brought online within 30 days is only about 700,000 barrels per day. “That means the market is vulnerable to strong demand in a cold winter or any new supply outage," she said.

What to watch: In a joint statement, the European Union, France, Germany and Britain — who are seeking to maintain trade ties with Iran — said they "deeply regret" the reimposition of sanctions by the United States. Europe will not receive exemptions, and could look to establish a special payments system with Russia and China if the Trump administration sanctions SWIFT, the financial channel Iran uses to get paid for oil exports.

  • Treasury Secretary Steve Mnuchin wrote in a Financial Times op-ed that foreign financial institutions that "knowingly engage" in "certain significant transactions" with Iran will be subject to sanctions.

Go deeper: Trump administration blinks on "zero" oil exports from Iran

Go deeper

2 hours ago - World

Maximum pressure campaign escalates with Fakhrizadeh killing

Photo: Fars News Agency via AP

The assassination of Mohsen Fakhrizadeh, the architect of Iran’s military nuclear program, is a new height in the maximum pressure campaign led by the Trump administration and the Netanyahu government against Iran.

Why it matters: It exceeds the capture of the Iranian nuclear archives by the Mossad, and the sabotage in the advanced centrifuge facility in Natanz.

Scoop: Biden weighs retired General Lloyd Austin for Pentagon chief

Lloyd Austin testifying before Congress in 2015. Photo: Chip Somodevilla/Getty Images

Joe Biden is considering retired four-star General Lloyd Austin as his nominee for defense secretary, adding him to a shortlist that includes Jeh Johnson, Tammy Duckworth and Michele Flournoy, two sources with direct knowledge of the decision-making tell Axios.

Why it matters: A nominee for Pentagon chief was noticeably absent when the president-elect rolled out his national security team Tuesday. Flournoy had been widely seen as the likely pick, but Axios is told other factors — race, experience, Biden's comfort level — have come into play.

Updated 4 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Health: WHO: AstraZeneca vaccine must be evaluated on "more than a press release."
  2. Politics: Supreme Court backs religious groups on New York COVID restrictions.
  3. World: Thailand, Philippines sign deal with AstraZeneca for vaccine.
  4. Economy: Safety nets to disappear in December Black Friday shopping across the U.S., in photosAmazon hires 1,400 workers a day throughout pandemic.
  5. Education: National standardized tests delayed until 2022.