FXStreet (Mumbai) – An expert panel discussion organized by Credit Suisse has found as viable Iran’s objective to increase its crude oil production in a post-sanctions era.
Thomas Adolff, Research Head at Credit Suisse told the panel that was held on Friday in Zurich that Iran could reach pre-sanction levels of production by mid-2016, but the impact on oil markets will be manageable “as long as Libyan production does not come back online.”
The sale of additional crude will come after a verification process, which Iran expects will take two to three months, Adolff said citing his research. The US anticipates the process lasting from four to six months.
Further, Adolff said that Iran anticipates receiving no more than $60 per barrel for its oil, adding that the country “is prepared for even lower prices.”
He added that once a deal has been implemented, President Obama is likely to cancel Treasury sanctions against Iran through the use of executive order.
While, Fereidun Fesharaki, the chairman of global oil and gas consultancy FGE, told the panel that the impact on markets will be around $3 to $6 per barrel.
Fesharaki added that Iran may have some difficulty marketing its additional crude production “unless Saudi Arabia makes room for the added barrels.”
He further emphasized that Iran understands the new realities of today’s oil market, and is “unlikely to engage in a bitter price war it cannot win.”
(Market News Provided by FXstreet)