Iran’s oil supply may be much lower than anticipated
Baku, Azerbaijan, Oct.11
By Leman Zeynalova – Trend:
Iran’s oil supply to the market may be much lower than anticipated in May, the US Energy Information Administration (EIA) said in its October Short-Term Energy Outlook (STEO).
“Trade press reports that major oil importing countries including Japan, South Korea, China, and India, are planning or are considering sharp reductions in crude oil imports from Iran,” said the report.
As a result, the amount of Iranian crude oil supply available in the global market may be much lower than market participants initially expected in May, when the United States announced it would exit from the Joint Comprehensive Plan of Action, according to the EIA.
EIA estimates that Iranian crude oil production fell by more than 0.4 million barrels per day (b/d) since May to an average of 3.4 million b/d in September.
“Both Brent and WTI crude oil prices reached four-year highs on October 3. Crude oil prices rose in anticipation of potentially steep declines in Iranian crude oil production and exports as a result of the reinstitution of US sanctions on November 4,” said the report.
Sanctions are due to be re-imposed on Iran's oil industry on November 4. The move comes after US President Donald Trump decided to withdraw his country from the 2015 nuclear deal in May.
The US has said that countries or companies that conduct transactions with Iran are liable to face secondary sanctions.
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