Bloomberg: US Likely to Turn a Blind Eye to Iran Oil Sanctions Violations to Control Prices
Bloomberg news agency has reported, citing a senior official from Vitol Group, the world’s largest private oil trading company, that the US is likely to turn a blind eye to violations of Iran sanctions in order to control global oil prices.
Mike Muller, head of Vitol Group’s Asia division, stated that given the US midterm elections in November of this year, the Biden administration will likely decide to turn a blind eye to Iran’s oil exports to prevent oil prices from rising further.
According to him, President Biden would likely allow Iran to increase its oil exports even without a nuclear agreement.
Muller stated that if the nuclear agreement is revived, Iran would export an additional 500,000 to one million barrels of oil per day to the market, and on the other hand, Iran has 100 million barrels of stored oil without buyers that could enter the market sooner. This volume of oil could have a significant impact on controlling global oil prices.
Josep Borrell, the EU’s foreign policy chief, announced on June 4 that the likelihood of a nuclear agreement has decreased. Meanwhile, the US seized an Iranian oil shipment last month that had been confiscated by Greece.
Muller stated that the confiscation of Iranian oil shipments will likely not continue.
Iran increased its daily oil exports from 650,000 barrels to 840,000 barrels in the first three months of this year (last winter), but after Western sanctions against the Kremlin due to its military aggression against Ukraine, Russia’s significant discount to China, Iran’s only official oil buyer, has caused Iran’s oil exports to drop to 570,000 barrels per day.
Global oil prices have grown more than 50 percent during this year due to Russia’s military aggression against Ukraine and Western sanctions against the Kremlin, reaching around $120.
The surge in gasoline prices in the US to $4.8 per gallon will also cause dissatisfaction among American voters with the Biden administration and the Democratic Party.
Currently, both the Democratic and Republican parties want to pressure the Islamic Republic of Iran to return to the JCPOA, but Muller says the upcoming US elections may force the Biden administration to turn a blind eye to violations of oil sanctions by Iran.
Vitol, which traded 7.6 million barrels of oil and oil products daily last year, says global oil supply is scarce and releasing American strategic oil reserves could help control prices to some extent.
Recently, OPEC and allied countries led by Russia agreed to increase their production by approximately 650,000 barrels per month over the next two months; however, Muller stated that given that some OPEC member countries lack the capacity to increase oil production and Russia itself is facing production decline, this decision will not have much impact on reducing oil prices.
Source: Radio Farda
