The
Iran and 5+1 talks firstly caused Oil
Prices Drop Amid 'Excitement' Over End to Iran Sanctions couple of days ago,
but later the market backed off due to slow resume of Iran's return to
production. These are heated transient reactions by market observers not the
steady state of world scale economy.
Traders are taking heart in
projections by oil analysts that it would take Iran many months to ramp up its
oil exports significantly. They believe the terms of the negotiations and years
of under-investment would leave Iran coming up with no more than 500,000 bpd at
the end of the year and shy of 1 million bdp by mid-2016.
Yet analysts say it would take
Iran many months to fully ramp up its export capacity following any easing of
sanctions. But even a modest initial increase would be enough to pull
international oil prices down further as the market is already producing around
2.5 million barrels per day above demand.
"The
market of Oil products as bitumen and base oils, would follow the oil market
trend as always with a lag. So no rapid decrease is estimated to take place at
this time." Said Emad Honarparvar, CEO of Modiran trading company to buy-bitumen.com.
Many
speculators may face a maximum 2% fluctuation in oil index in coming days of
political news and press releases but this would't affect the actual production
amounts, he added.
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