The expert urged not to wait for the oil shortage due to sanctions against Iran

© AFP 2018 / Atta Repaginate tankers at an offshore oil platform in the heart of the Iranian Kharg island in the Persian Gulf. Archival photoThe expert urged not to wait for the oil shortage due to sanctions against Iran© 2018 AFP / Atta Kenare

A strong collapse of the supply on the world oil market because of US sanctions to Iran should not wait, as growth in oil prices to $ 100 a barrel this year, said RIA Novosti Director of the group on natural resources and commodities, Fitch ratings Dmitry marinchenko.

«A strong collapse of the proposal (on the world oil market — ed), apparently, is not worth waiting. Oil imports from Iran probably will fall further compared with October — but the overall drop in production relative to quota is unlikely to exceed 1 million barrels per day. This means that the system will remain standby production capacities — a fact that will not allow the prices to soar up to 100 dollars (per barrel — ed.) this year. It is more likely that they will remain in the range of 70-80 dollars,» explained marinchenko.

The fifth of November came into force the US sanctions against Iran, which also cover the export of oil. Washington has previously said it aims to bring Iranian oil exports down to zero and urged its customers to abandon the purchase. Secretary of state Mike Pompeo said that the U.S. provide temporary exceptions to the oil sanctions to China, India, Italy, Greece, Japan, South Korea, Taiwan and Turkey.

«The list of countries is not obvious — Spain, for example, also bought oil from Iran, but the list is not ranked, unlike Italy. Generally, a little unexpectedly, the list contains the European countries, but most importantly, that included China and India are the biggest importers,» — said marinchenko.

On the morning of 5 November amid the long-awaited start of US sanctions to Iran, world prices were declining by about 0.5%. As of 9.11 MSK price of January futures for North sea petroleum mix of mark Brent has decreased on 0,45%, to 72.5 dollars per barrel, the price of December futures for WTI — by 0.57% to 62,78 dollars per barrel. During the day, the decline has slowed, and began to increase in price, and after the statements of countries that fall under the exception, prices have accelerated the growth. As of 17.12 GMT the price of January futures for North sea petroleum mix of mark Brent have grown on 1%, to 73,56 dollars per barrel, the price of December futures for WTI — by 0.62% to 63,53 per barrel.

«The decline in prices below $ 80 has occurred against easing of the US position on Iranian sanctions, hence the high probability of issuing special permits were already priced in,» explained marinchenko.

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