UPDATE 7-Oil falls on Iran's willingness to negotiate, RIN sell-off
* EPA announces it will change biofuel policy in 2014
* North Sea Buzzard oilfield starts exporting Tuesday
* RIN sell-off drags gasoline, crude down
* U.S. crude, gasoline inventories seen down last week-poll
* Coming up: U.S. API weekly crude stocks at 2035 GMT
(New throughout, updates prices, market activity, adds details of EPA announcement) NEW YORK, Aug 6 (Reuters) - Oil fell around $1 a barrel on Tuesday, as Iran's new president signalled willingness to negotiate with the West over Tehran's disputed nuclear program, and as U.S. gasoline prices slid after a sell-off in ethanol credits. Iran's newly elected President Hassan Rouhani said he was ready to enter "serious and substantive" negotiations, reducing the geopolitical risk premium for oil prices. The price of U.S. gasoline fell 1.25 percent , dragged by a sell-off in ethanol credits U.S. refiners must purchase to comply with environmental regulations. The cost of the credits, also known as Renewable Identification Numbers (RINs), slid almost 20 percent on market talk ahead of an Environmental Protection Agency announcement. The EPA said it would maintain its 2013 target for biofuel use but use its authority to lower the volume goal for 2014. RINs fell as low as 80 cents, after having reached prices of more than $1 on Monday and of $1.50 two weeks ago. "The RINs issue sent oil products lower, and they were already weak because of returning refinery units," said Phil Flynn, an analyst with Price Futures Group in Chicago. "Even ethanol producers are open to the EPA issuing some sort of waiver to avoid having congress revamp the whole program." U.S. oil fell $1.20 to trade at $105.36 per barrel by 1:07 p.m. EDT (1707 GMT), having hit a low of $104.99 a barrel. Brent crude was down 58 cents to trade at $108.12 per barrel, having fallen to a low of $107.46. Gasoline futures tumbled 3 cents to trade around $2.92 a gallon, having reached lows of $2.88. Prices were further pressured by news that oil exports from the Buzzard field in the North Sea, which form part of the underlying market for Brent futures, are set to resume on Tuesday, easing concerns about short-term supply disruptions.
YEMEN EVACUATION, PROJECTED INVENTORY REDUCTIONS Oil's decline was checked by news that Washington told U.S. citizens in Yemen to leave the country immediately due to the threat of potential attacks from militants. That pushed Washington to shut diplomatic missions across the Middle East, and to airlift some personnel from Yemen on Tuesday.
"The latest terror warning issued by the U.S. for North Africa and the Middle East are likely to preclude any sharper fall in prices," Commerzbank oil analyst Carsten Fritsch said. Losses were also limited by expectations that U.S. crude and gasoline stockpiles fell last week. A preliminary Reuters poll, ahead of weekly inventory reports from the American Petroleum Institute (API) and the U.S. Energy Information Administration, forecast a drop in crude stocks of 700,000 barrels in the week ended Aug. 2. In the previous week, U.S. crude inventories rose 431,000 barrels to about 365 million barrels. The API report is released at 4:35 p.m. EDT on Tuesday (2035 GMT).
(Additional reporting by David Sheppard and Robert Gibbons in New York, Peg Mackey in London, and Manash Goswami in Singapore; Editing by Dale Hudson, Jane Baird and Sofina Mirza-Reid)