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Iran is confident that its oil exports will not be disrupted by the re-imposition of sanctions after the United States vowed to withdraw from the Nuclear Deal, according to Iranian Oil Minister Bijan Zanganeh as quoted by Reuters.
Zanganeh referred to the previous drop off in its oil exports courtesy of the previous sanctions “history”.
“Trump’s decision will not have any impact on our oil export,” the minister said on state television.
What the new sanctions will be is not yet known, but previous sanctions on the Middle Eastern country saw a major drop off in oil exports that other OPEC members were only too happy to lap up.
Iran has done much to ratchet up its oil production and corresponding exports after the first round of sanctions were lifted in January 2016, bringing it back into the fold as OPEC’s third largest oil producer—even at the expense of the production cut agreement it agreed to with OPEC.
Threats of new sanctions against Iran came shortly after President Donald Trump took office, and after Iran conducted ballistic missile testing, a violation of at least the spirit of the nuclear deal. The US President provided waivers until now, however, vowing in January 2018 that it would be the last time he did so.
Analyst opinion, however, contradicts Iran’s upbeat tone. Analysts polled by S&P Global Platts expect an immediate impact of less than 200,000 bpd of Iranian oil shut in, possibly rising to 500,000 bpd after six months as the deadline for sanctions approaches and the wind down period ends. Other analysts think that the reduction of Iranian exports could be closer to 1 million bpd.
Iran is the world’s fifth largest exporter at 2.5 million barrels per day, according to the IEA.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group.