Iran to sell oil as much as it can to offset sanction loss

LONDON, July 10 (Reuters): Iran's vice president acknowledged on Tuesday that US sanctions would hurt the economy, but promised to "sell as much oil as we can" and protect banking.

Eshaq Jahangiri said Washington was trying to stop Iran's petrochemical, steel and copper exports. "America seeks to reduce Iran's oil sales, our vital source of income, to zero," he said, according to Fars news agency.

"It would be a mistake to think the US economic war against Iran will have no impact," Jahangiri added.

President Donald Trump said in May he would pull the United States (US) out of an international accord under which Tehran had agreed to limit its nuclear development in exchange for sanctions relief.

Trump said he would reintroduce sanctions and Washington later told countries they must stop buying Iran's oil from Nov. 4 or face financial consequences.

On Tuesday, the US ambassador to Germany also called on Berlin to block an Iranian bid to withdraw large sums of cash from bank accounts in Germany.

Jahangiri said Iran's foreign ministry and the central bank have taken measures to facilitate Iran's banking operations despite the US sanctions. He did not elaborate.

European powers which still support the nuclear deal say they will do more to encourage their businesses to remain engaged with Iran - though a number of firms have already said they plan to pull out.

Foreign ministers from the five remaining signatory countries to the nuclear deal - Britain, France, Germany, China and Russia - offered a package of economic measures to Iran on Friday but Tehran said they did not go far enough.

"We think the Europeans will act in a way to meet the Iranian demands, but we should wait and see," Jahangiri said.

Meanwhile, oil prices rose by more than $1.0 dollar per barrel on Tuesday due to growing global supply outages, with Norway shutting down one oilfield as hundreds of workers began a strike and Libya saying its production more than halved in recent months.

The disruptions add to supply worries around the world. Venezuela's production has collapsed due to a lack of investment and Iranian exports have suffered due to US sanctions. OPEC, meanwhile, has little capacity to fill the gap as demand for oil quickens.

Benchmark Brent oil futures LCOc1 rose by $1.13 per barrel, or 1.4 per cent, to $79.20 per barrel by 0915 GMT, following a 1.2-per cent climb on Monday. US light crude futures were up 53 cents, or 0.7 per cent, at $74.38.

Mounting supply concerns could push Brent above $85 per barrel, MUFG Bank said in a note.

"Renewed geopolitical supply-side disruptions stemming from Canada, Iran, Libya, Venezuela and the US raises the likelihood of oil trade interruptions and with it upside risks to oil prices in the near term," MUFG said.