The revival of the Iranian nuclear agreement is in its final stages, and the oil markets are awaiting
Negotiations in Vienna to revive a 2015 agreement that lifted sanctions in exchange for curbs on Iran's nuclear activities are in their 10th month, with diplomats suggesting the talks should end by the end of February.
Traders and oil producers are watching these talks closely, as the agreement could lead to the return of supplies of millions of barrels of Iranian oil to the global market, which was the second largest producer and exporter of oil in OPEC before the sanctions.
annexation of Iran
The “OPEC +” alliance, since April 2021, has restricted its production to control oil prices after these prices witnessed a significant decline during the year 2020 after the spread of Corona, and OPEC + is considering including Iran in this agreement to limit oil supplies, in the event that a settlement is reached to revive its agreement nuclear power with world powers, in an attempt to avoid competition for market share that could hurt prices.
The International Energy Agency says that the success of the talks could lead to the lifting of US sanctions on Iran's exports, which would return 1.3 million barrels per day of Iranian oil to the market. Just under $100 a barrel.
Note that Iran is excluded from the current agreement between the Organization of the Petroleum Exporting Countries "OPEC" and its allies, in what is known as the "OPEC +" alliance to limit oil supplies, due to the impact of sanctions on its exports.
Some analysts believe that Iran will not agree to restrict its oil production again after the sanctions imposed on it by the West, which will lead to confusion and failure of the plan set by OPEC + and will therefore lead to flooding the market with Iranian oil, and there will be a large supply and a decline in oil prices.
Iran is preparing to return to exporting its oil again by reviving its agreements with countries that were the main importers of its oil, such as China and South Korea.
Despite the sanctions imposed on Iranian oil, for the first time since the end of 2020, China announced the volume of its import of Iranian oil, saying that it reached 1.9 million barrels last December.
Unofficially, China's imports of Iranian oil exceeded 500,000 barrels per day on average between last August and October, as buyers considered that the advantage of obtaining crude at cheap prices outweighed the risks of violating US sanctions.
Traders say Iranian crude is being exported to China as oil from Oman, the United Arab Emirates and Malaysia to evade sanctions, reducing supplies from Brazil and West Africa.
Officials from the National Iranian Oil Corporation also met with at least two South Korean refinery officials to discuss a possible return of supplies from the oil-producing country in the Persian Gulf region, where South Korea used to buy mainly Iranian oil, which is very light.
During its negotiations, Iran demanded legal, political and economic guarantees that the United States would not disrupt the agreement again, as former President Donald Trump did in 2018.
The parties to the agreement, which the United States abandoned nearly four years ago, have indicated growing optimism that a consensus can be reached, which is contingent on oil markets. Its uranium enrichment to be closer to a nuclear weapon.
"The moment of truth has come," German Chancellor Olaf Scholz said at the Munich Security Conference, which was attended by a high-level group of world leaders and diplomats.