Oil prices rose on Monday as a possible hurdle occurred in reviving 2015. Iran nuclear deal that could add more oil supply. Goldman Sachs said the case for higher prices remains intact even with increased Iran exports.
Brent crude oil futures for July rose 72 cents, or 1.1%, to $67.16 a barrel by 0651 GMT, while U.S. West Texas Intermediate for July was at $64.25 a barrel, up 67 cents, or 1.1%. Oil prices fell almost 3% last week after Iran’s president, Hassan Rouhani, said the United States was ready to lift sanctions on his country’s oil, banking and shipping sectors.
Analysts said that Iran’s oil production has been rising in recent months, likely in anticipation of a lifting of the sanctions. The speaker of Iran’s parliament said on Sunday a three-month monitoring deal between Tehran and the U.N. nuclear watchdog had expired and that its access to images from inside some Iranian nuclear sites would cease.European diplomats said that negligence to agree to an extension of the monitoring contract would plunge wider, indirect talks between Washington and Tehran on reviving the 2015 Iran nuclear deal into crisis. Those talks are due to resume in Vienna this week.
Former President Donald Trump withdrew the United States from the deal in 2018 and re-imposed sanctions. Goldman Sachs analysts said that with a potential restart of Iran exports, the case for higher Oil prices remains unchanged due to a vaccine-driven boost in global demand.
The bank said that after a restart in July, we estimate that Brent prices would still reach $80 per barrel in the fourth quarter, 2021, with our new base case for an October restart still supporting our $80 per barrel forecast for this summer. Meanwhile, the National Hurricane Center said that it is issuing advisories on Tropical Depression Ana and that a tropical cyclone formation is not expected during the next five days.