LogIn LogOut

Oil Prices Rise on Potential Snag in Iran Talks

May 24, 2021

Credit:  Maksym Yemelyanov
Credit: Maksym Yemelyanov

Oil prices rose on Monday as a potential snag emerged in reviving the 2015 Iran nuclear deal that could add more oil supply, while Goldman Sachs said the case for higher prices remained intact even with increased Iran exports.

Brent crude oil futures for July were 90 cents, or 1.4%, higher at $67.34 a barrel by 1215 GMT, while U.S. West Texas Intermediate for July was at $64.44 a barrel, up 86 cents, or 1.4%.

Oil prices fell almost 3% last week after Iran's President Hassan Rouhani said the United States was ready to lift sanctions on his country's oil, banking and shipping sectors.

However, the speaker of Iran's parliament said on Sunday a three-month monitoring deal between Iran and the U.N. nuclear watchdog had expired and that its access to images from inside some Iranian nuclear sites would cease.

European diplomats said last week that failure to agree an extension of the monitoring deal would plunge wider, indirect talks between Washington and Tehran on reviving the 2015 Iran nuclear deal, due to resume in Vienna this week, into crisis.

Former President Donald Trump withdrew the United States from the deal in 2018 and re-imposed sanctions.

"All in all, it seems to be only a matter of time before the sides involved put pen to paper on a new nuclear accord," said Stephen Brennock of oil broker PVM.

"Investors are bracing for a fresh wave of what will surely be heavily discounted Iranian crude ... yet for all this alarmism, an aggressive ramp-up in Iranian production and exports is unlikely to stall the drawdown in global oil stocks."

Even with a potential restart of Iran exports, the case for higher oil prices remains intact due to a vaccine-driven increase in global demand, Goldman Sachs analysts said.

"Even aggressively assuming a restart in July, we estimate that Brent prices would still reach $80 per barrel in fourth quarter 2021," the bank said in a note.

Its new base case for an October restart still supports an $80 per barrel forecast for this summer, it added. 

(Additional reporting by Jessica Jaganathan; Editing by Richard Pullin, Jan Harvey and Bernadette Baum)



Current News

Exxon Considers Pledging Net-zero Carbon Emissions by 2050

Exxon Considers Pledging Net-zero Carbon Emissions by 2050

Opinion: Weak Crude Imports in Asia Undercuts Oil Bulls

Opinion: Weak Crude Imports in Asia Undercuts Oil Bulls

Subsea Tech: Taking 3D Printing to the Seabed

Subsea Tech: Taking 3D Printing to the Seabed

Record-Breaking Platform Delivered to the Hod Field From Aker Solutions’ Yard in Verdal

Record-Breaking Platform Delivered to the Hod Field From Aker Solutions’ Yard in Verdal

Chinese Firms Seek LNG Cargoes, Demand is Strong

Chinese Firms Seek LNG Cargoes, Demand is Strong

ConocoPhillips Beats Estimates on Higher Prices, Output

ConocoPhillips Beats Estimates on Higher Prices, Output

Acteon Inks Deal to Support Philippines LNG Import and Regasification Terminal

Acteon Inks Deal to Support Philippines LNG Import and Regasification Terminal

Subscribe for AOG Digital E‑News

AOG Digital E-News is the subsea industry's largest circulation and most authoritative ENews Service, delivered to your Email three times per week

https://accounts.newwavemedia.com