FILE PHOTO: A gas flare on an oil production platform in the Soroush oil fields is seen alongside an Iranian flag in the Persian Gulf, Iran, July 25, 2005. REUTERS/Raheb Homavandi/File Photo
Reuters: As sanctions start to bite, Iran crude exports set to wilt
LONDON (Reuters) - Iran’s oil exports could fall by as much as two-thirds by the end of the year because of new U.S. sanctions, putting oil markets under huge strain amid supply outages elsewhere in the world.
Washington initially planned to totally shut Iran out of global oil markets after President Donald Trump abandoned a deal that limited Iran’s nuclear ambitions, demanding all other countries to stop buying its crude by November.
The United States has since somewhat eased its stance, saying that it may grant sanction waivers to some allies that are particularly reliant on Iranian supplies.
But most analysts still think the sanctions will significantly reduce Iran’s crude oil exports with some of the worst case scenarios forecasting a two-thirds drop to only 700,000 barrels per day (bpd).
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WNU Editor: I study oil markets very closely, and I concur with this assessment. I would only add one more thing. The oil that Iran will be selling will be sold only at a big discount. As to who will be buying Iranian oil .... China will be number one, but countries like India, Pakistan, etc., will be finding ways to skirt U.S. sanctions to buy what they can get away with.
