With some progress being made in the negotiations to restart the Iran nuclear deal, it is now possible for Iranian crude oil to officially return to the market. Foreign media quoted people familiar with the matter as saying that U.S. President Joe Biden’s administration has expressed its willingness to relax restrictions on Iran’s oil, financial and other industries.
All in all, this is already a factor that crude oil investors have to pay attention to. It is said that once the United States relaxes sanctions, Iranian crude oil will return quickly, but how fast can it be? An analyst firm gave the answer on Thursday.
Henry Rome, senior global macro analyst at Eurasia Group, said in a report on Thursday: “Once Iran resumes compliance with the nuclear agreement (assuming that it will return to the agreement within two Starting in March), it will try to export as much oil as possible as quickly as possible. It will not be restricted by OPEC+ quotas and will instead strive to regain its market share.”
He provided a chart showing that Iran could reach 3.8 million barrels per day of production within 12 months of a deal:
Of course, Iran will not export all this crude oil. Rome estimates that new exports could reach about 2.2 million barrels to 2.4 million barrels per day. Including sales from the country’s large offshore stocks, total exports could be as high as 2.7 million barrels per day next year, he said.
Within three months of achieving compliance, Iran’s export growth will likely reach 700,000 barrels per day. Within three to six months after the agreement is reached, Iran will About 70 million barrels of offshore stocks were dumped.
Rome estimates that Iran’s daily production will reach 3.2 million barrels to 3.5 million barrels in the first three months after compliance, and it will only take 6 to 9 months to reach the maximum. The production capacity is 3.8 million barrels per day.
Rome pointed out that the United States and Iran have proposed reaching an interim agreement by June, which would buy time for negotiations to reach a comprehensive agreement in the fall. He said that although it is possible that an interim agreement would allow Iran to legally export small amounts of crude oil to the market, this is unlikely because it would be a big concession for the United States.
The exact quantity of Iran’s current crude oil exports is unknown. Rome estimates that it may be between 700,000 and 1 million barrels.
Two assessments on Thursday showed that Iran’s crude oil exports since April are still higher than last year’s level, indicating that progress in negotiations on the Iran nuclear deal will help boost Iran’s Crude oil export volume. </p
