Oil supply may be 'very challenging' to keep up after US sanctions Iran - IEA
Sputnik reported that the global energy watchdog issued a warning Friday about the impact of looming US sanctions against Tehran as oil prices rose over 1 percent in Friday trading, coming close to breaking even after a drop in prices earlier in the week. In its latest Oil Market Report, the International Energy Agency said it expects a "far less calm" market picture for oil than the one that exists.
The report said that "When we publish our next report in mid-September, we will be only six weeks away from the US's deadline for Iran's customers to cease oil purchases. As oil sanctions against Iran take effect, perhaps in combination with production problems elsewhere, maintaining global supply might be very challenging, and would come at the expense of maintaining an adequate spare capacity cushion."
Stressing that "recent cooling down of the market, with short term supply tensions easing, currently lower prices, and lower demand growth might not last," the Paris-based watchdog noted that "the market outlook could be far less calm" a month from now "than it is today."
Energy analysts believe Iranian crude oil exports may fall by between 500,000 to 1.3 million barrels per day, down from recent highs of 2.7 million bpd in May, amid Western countries' preparations for Washington's oil sanctions to step into effect in November.
Beijing has indicated that it will not halt its imports of Iranian oil, although other countries, including US allies Japan and South Korea, have scaled back their purchases, with some European energy firms doing the same.
Source : Sputnik