IMF Predicts 40% Inflation In Iran Due To U.S. Sanctions

A new mega cartel is emerging in oil markets

A new mega cartel is emerging in oil markets

"It is possible that the Americans can block a path for our oil exports, but this is not the case of the Americans pressuring and closing the only door available for Iran's oil exports", stated the Iranian leader.

India provisionally imported 207.3 mt of crude oil in 2018-19, down from 220.4 mt in the previous financial year.

Oil hit a six-month high last week as the White House announced it would tighten sanctions on crude shipments from Iran, ending the waivers that now allow several countries to keep buying Iranian oil.

Of course not all analysts are as confident about the market's prospects in the near future: Neil Beveridge, senior oil and gas analyst at Bernstein, anxious that "If we lost Libya from the market, it would take spare capacity down to very uncomfortable levels and would certainly add a major risk premium to oil". He has asked members of the Organization of the Petroleum Exporting Countries to increase the flow of oil to compensate for losses from Iran and Venezuela. "Anyone who uses oil as a political tool must also accept its consequences".

Highlighting the necessity for a boost to production in Iran and a rise in the export of non-oil products, the president said the Iranian nation will not allow the U.S. to achieve its objectives and that Iran will definitely bring the United States to its knees.

Swaraj, according to Hindustan Times, told Pompeo that India should be allowed to import Iranian crude for some more time as the general election is underway in the country.

Already Opec supply hit a four-year low in April due to further involuntary declines in sanctions-hit Iran and Venezuela and output restraint by top exporter Saudi Arabia, a survey found. The benefits of rupee trading and free shipping gives Tehran an upper hand over Gulf neighbours Saudi Arabia and the UAE. The United States has warned nations not complying with its sanctions against Iran with diplomatic backlash. United States was ranked 18th in 2017-18.

Iran's national currency, the rial, lost more than 60 percent a year ago, disrupting Iran's foreign trade and boosting annual inflation. However, for Indian refiners, distance is an important factor as this adds to the freight cost.

Brent crude futures hit a session high of $73.27 per barrel and settled 76 cents, or 1.1 percent, higher at $72.80.

For oil marketing companies (OMCs), 60-70% of crude oil supply is term contract since it ensures a steady supply. Around 30-40% of the crude requirement is imported on a spot basis.

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