Once the Iran nuclear deal is reached, 93 million barrels of crude oil will immediately flood the market?

time:2022-12-09 16:53:34source:chakarski.com author:Fuel stock
Once the Iran nuclear deal is reached, 93 million barrels of crude oil will immediately flood the market?

Iran nuclear negotiations have fallen into a "tug-of-war" again. Iran said it will not respond to the Biden administration's reply to the EU text until at least September 2, and the restart of the nuclear deal negotiations will be extended to September. However, in recent weeks of talks, Iran has made major concessions and signaled it is closer than ever to a deal that would see a rush of crude flooding the market. On Monday, media reported that as much as 93 million barrels of Iranian oil was gathering momentum. About 93 million barrels of Iranian crude and condensate are currently stored in onshore tanks and offshore tankers awaiting delivery, according to ship-tracking firm Kpler. According to another company, Vortexa, there are about 60 to 70 million barrels of Iranian crude oil. What is the concept of close to 100 million barrels? In contrast, according to the International Energy Agency, the average daily global oil supply this year is about 105 million barrels, and the size of the strategic oil reserve that Biden urgently released is 180 million barrels of oil. This means that the return of Iranian crude oil to the market will bring a lot of downward pressure on oil prices, which are currently around $95.

The crude oil fleet is ready to go.

The crude oil fleet is ready to go, and once an agreement is reached, it will quickly ship to buyers. John Driscoll, chief strategist at JTD Energy Services Pte, said Iran has built up a sizable crude oil shipping fleet that will soon enter the market. He added that it may take "a little time" to resolve insurance and shipping issues, as well as post-sanction spot sales. However, Goldman Sachs had previously been skeptical, saying that even if a nuclear deal was reached, the export of Iranian oil would not start until 2023. At present, it is a complicated moment for global crude oil traders. Iran may re-enter the global crude oil market in an all-round way. The EU will impose stricter restrictions on Russian crude oil supply from December and enter the countdown. The Biden administration will release the strategic reserve. Ends October. The analysis pointed out that judging from the floating storage of Iranian oil barrels in recent weeks, the return to the global oil market may put downward pressure on crude oil futures prices and ease tensions in other regions.

Most likely to flow to the European market

Iranian crude oil may be the first to flow to the European market, but the Asian market share will also be actively sought. Vortexa analyst Emma Li said that since Trump announced the U.S. withdrawal from the Iran nuclear deal and imposed economic sanctions on Iran, Iran's oil shipments have remained at around 1 million barrels per day, with China the biggest buyer. But with sanctions lifted, there could be some shifts in Iran's targeting. Driscoll pointed out that Iran may increase overseas sales and try to fill the void left by Russia in Europe (ie Spain, Italy, Greece and even Turkey), but Iran will also try to regain valuable Asian market share. Driscoll said: "It is only natural that Iran wants to supply crude oil to Europe first to grab Russia's share. But in the long run, Iran will seek long-term deals in Asia. Kpler data shows that in 2017 and 2018, Europe consumed an average of 748,000 barrels per day and 528,000 barrels of Iranian crude oil, while Asia consumed an average of 1.2 million barrels and nearly 1 million barrels of Iranian crude oil per day.

Saudi Arabia quit, threatening Biden "not to resume"

But Saudi Arabia quit, and used oil production cuts to send a clear signal to the United States: Do not resume the Iran nuclear deal. Saudi Energy Minister Abdulaziz bin Salman warned on Monday: "Extreme" volatility and lack of liquidity mean crude futures markets are increasingly disconnected from fundamentals, which could force OPEC+ to take action production cuts. People familiar with Saudi Arabia's thinking said that Riyadh's sudden intervention was not as simple as stabilizing oil prices. It was showing the United States that it "ignored" Saudi Arabia's own security concerns and resumed the Iran nuclear deal. Saudi Arabia's possible "response" in the crude oil market. This article is from Wall Street News, welcome to download the APP to see more
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