Global oil markets won’t feel the real impact of Iran’s historic deal with world powers until 2016 as sanctions remain in place while nuclear inspectors go to work, said banks including Citigroup Inc., Goldman Sachs Group Inc. and Commerzbank AG.
OPEC’s fourth-largest member won’t achieve a crude-export boost of more than 500,000 barrels a day, or about 50 percent, until next year as Iran’s compliance with curbs on its nuclear program is verified, the banks say. The nation will probably choose to gradually increase exports once sanctions are lifted, rather than risk lower prices by rapidly pushing crude into an oversupplied market, according to the International Energy Agency.
It will be a long and winding road before Iranian oil returns to the market.
The agreement between Iran and six world powers will eventually lift restrictions that have halved its crude exports, provided the Persian Gulf nation removes nuclear centrifuges and cuts uranium stockpiles. Sanctions will remain in place at least until international monitors report on the country’s compliance in December.
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Craig Erlam
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