The prospect of Iran’s oil sanctions being lifted appears increasingly possible, which would see Iran’s oil industry opened up to foreign investors and would trigger a swift increase in international crude output.
Oil major Total today leads an envoy of French business leaders to Iran, and according to reports meetings will be held with the Iranian Oil Company.
France has been one of the strongest opponents of Iran among the six “world powers” that negotiated the interim deal, to stand down Iran’s nuclear programme and in return lift sanctions on oil sales and open up the country’s economy to foreign investment.
The fact the French business interests are moving to become early movers in Iran is being seen as an endorsement of the recent diplomatic progress.
The French envoy follows more diplomatic talks over the weekend, this time between Iran’s foreign minister Javad Zarif and US Secretary of State John Kerry. Zarif claimed that after ten years of dispute, it would be a “disaster” if the provisional agreement did not lead to a permanent agreement.
Last month, Iran’s oil minister Bijan Zanganeh dangled oil executives a carrot, saying the Middle Eastern country will have a new “attractive” model to draw in investment from international oil companies.
Elsewhere, in the oil market, Iraq’s oil minister revealed that the country’s oil exports dropped to 2.2mln barrels a day, but said that output would rise next month.
And weak economic statistics from China dented confidence in global economic growth, which some suspect will now stall in the first part of the year.
Brent slid to a 2-week low with futures falling below US$106, changing hands in London trading at US$105.80. West Texas Intermediary futures, meanwhile, were trading at US$97.60 per barrel.
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