• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 5 days The United States produced more crude oil than any nation, at any time.
  • 5 days How Far Have We Really Gotten With Alternative Energy
  • 3 days Bad news for e-cars keeps coming
  • 5 days China deletes leaked stats showing plunging birth rate for 2023
  • 6 days The European Union is exceptional in its political divide. Examples are apparent in Hungary, Slovakia, Sweden, Netherlands, Belarus, Ireland, etc.
  • 37 mins e-truck insanity
South Korea Warns Russia Over Military Pact with North Korea

South Korea Warns Russia Over Military Pact with North Korea

South Korea summoned Russian ambassador…

The Contested Island at the Heart of Russian-Chinese Relations

The Contested Island at the Heart of Russian-Chinese Relations

Russia and China's uneasy relationship…

Irina Slav

Irina Slav

Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.

More Info

Premium Content

Oil Prices: Few Tailwinds Until Driving Season Begins


Crude oil prices are likely to remain sensitive to bearish news such as progress on the Iran nuclear deal with the United States and the latest on Covid-19 in Asia until at least the start of summer driving season in the United States and the opening up of Europe.

Prices are "in a holding pattern until we get to June, because that's when Europe's going to start to reopen and the U.S. driving season will have officially kicked off," Bloomberg quoted the CEO of Infrastructure Capital Management, Jay Hatfield, as saying earlier this week.

On the good news front, the European Union agreed on the terms for issuing so-called green certificates that contain information about whether a traveler has been vaccinated, has a negative PCR test result, or is immune to the coronavirus after recovering from the disease. This should spur a lot more travel within the 27-member bloc.

The Iranian nuclear deal, however, remains a major headwind for prices, severely limiting upside potential in the immediate term.

"There continue to be positive statements out of Vienna from various participants, including Iran, that a deal is at hand," John Kilduff, a partner at Again Capital, told Bloomberg. "Even though we know they have already been ramping up their exports, it is adding to negative market sentiment."

Iran's President Hassan Rouhani said yesterday that the United States was ready to lift oil and banking sector sanctions.

"The talks in Vienna are about minor issues. They have accepted to lift sanctions on Iran's oil and shipping sectors as well as sanctions on the Central Bank and others," Rouhani said as quoted by Reuters.

An Iranian government official, however, told Iranian media that it was not a done deal yet, with the U.S. still reluctant to "completely lift any sanctions on the oil, banking, finance and energy sectors".

Meanwhile, Covid-19 cases are on the rise in some parts of Asia, rekindling worry about oil demand in the key region.

By Irina Slav for Oilprice.com


More Top Reads From Oilprice.com:

Download The Free Oilprice App Today

Back to homepage

Leave a comment
  • Mamdouh Salameh on May 22 2021 said:
    Tailwinds or headwinds, oil prices are headed upwards with Brent crude oil prices projected to hit $70-$80 a barrel in the third quarter of this year and average $65-$67 for the year.

    Many of the analysts and journalists who contribute articles to oilprice.com don’t seem to understand the complexity of a deal between the United States and Iran. So they prescribe the lifting of sanctions wrongly either as headwind for oil prices or a bearish influence when in fact this issue is neither and I will explain why.

    The claim by Iranian President Hassan Rouhani that the United States was ready to the sanctions is no more than a ploy to rally his supporters to do well in the 18th of June presidential elections. He knows that supporters of the Islamic Revolutionary Guard Corps (IRGC) are going to have a landslide victory in the presidential elections.

    We may never see a lifting of US sanctions on Iran even by 2023 or ever. The reason is that the positions of the United States and Iran are irreconcilable.

    Iran insists on a lifting of the sanctions first before it agrees to negotiate directly with the United States. On the other hand, the United States wouldn’t lift the sanctions or even ease them without an agreement on imposing strict limitations on Iran’s nuclear and ballistic missile development programmes which Iran will never ever accede to. The United States knows full well that Iran wants long-term ballistic missiles capable of carrying nuclear warheads otherwise why would it need these missiles. This the United States supported by Israel and its Arab allies in the Gulf will never accept. That is why a lifting of the sanctions will never see the light of day soon if ever.

    If in the very unthinkable possibility the sanctions were lifted, Iran could only bring 650,000 additional barrels a day (b/d) to the market. The reason is that Iran has been managing with help from China to export 1.5 million barrels a day (mbd) or 71% of its pre-sanction exports of 2.125 mbd. A global economy expected to grow this year by 6.3% as projected by the IMF could easily absorb the 650,000 extra Iranian barrels without any impact on oil prices

    Dr Mamdouh G Salameh
    International Oil Economist
    Visiting Professor of Energy Economics at ESCP Europe Business School, London

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News