Following the Saudis: Iran Joins Efforts to Save the Oil Market
30.10.2024
18
On Monday, Brent prices dropped by more than 6%, falling below $71 per barrel — levels not seen since early October. By Wednesday afternoon, oil prices were rising, approaching $72 per barrel.
"The risk of an escalation of the conflict in the Middle East has led to a temporary reduction in oil exports from Iran," the expert noted. Tereshkin added that marine oil shipments over the past nine months averaged 1.7 million barrels per day, but in the first ten days of October, they slightly exceeded 800,000 barrels per day.
According to the expert, the current reduction in Iranian oil exports is comparable in scale to Saudi Arabia’s decision to cut production by 1 million barrels per day, which took effect in July 2023 and led to a significant rise in oil prices. Between June and September last year, the average Brent price rose from $75 to $94 per barrel.
"While a similar surge is unlikely this time, Brent prices will not fall below $70 per barrel. The reduction in exports will be one of the factors supporting the market, even despite the limited geographic distribution of Iranian oil supplies," the agency's source believes.
However, in his opinion, the market will remain "nervous" in the coming weeks. In December, a gradual easing of OPEC+ quotas is possible, though it remains uncertain whether production will increase as per the agreed schedule or if any of the participating countries will significantly ramp up production in response to increased supply in North and South America.
The growth of production and exports in the U.S., Canada, and Brazil poses a key risk to both the OPEC+ agreement and the preservation of the status quo in the oil market, Tereshkin concluded.
Translated using ChatGPT.
Source: https://1prime.ru/20241030/neft-852511530.html
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