The possibility of more Iranian oil entering the market without a nuclear agreement – Mehr News Agency | Iran and world’s news

Mehr News Agency, International Group – Zahra Mirzafarjooyan: Following the imposition of new sanctions on Russian oil, The US State Department has authorized Italy’s Eni and Spain’s Repsol to resume oil imports from Venezuela.

Accordingly, revenues from the sale of Venezuelan oil to the two companies are to be deducted from Venezuela’s remaining debts.

According to the latest reports, the Biden government’s reported permission to use Venezuelan oil is part of an effort to rely less on Russian oil and divert Venezuelan shipments from China.

However, economic observers believe that the resumption of Venezuelan oil sales to the two companies, given its low volume, can not have an effect on reducing oil prices in world markets.

In this regard, the correspondent of Mehr had an interview with “Mehmet Ogucu”, the president of the London Energy Club and advisor to the former Prime Minister of Turkey, which follows.

*Why America decided to give Permission to resume oil imports from Venezuela has taken?

I was also very surprised that after years of confrontation and sanctions, a group of senior US officials traveled to Venezuela last March. The mission of the US delegation was to meet with the government of Nicolas Maduro to discuss the possibility of easing sanctions on Venezuelan oil exports. The trip came as the United States sought to isolate Russia from invading Ukraine and help Europe complete its massive gas supply.

Venezuela, the Kremlin’s most important ally in South America and one of the world’s largest oil reserves, was a major supplier of crude oil to the United States before its exports were halted due to internal problems and crippling Washington sanctions. When a decision was made as a result of closed-door bargaining in Caracas, Two companies, Eni of Italy and Repsol of Spain They were allowed to send Venezuelan oil to Europe next month to compensate for Russian-sanctioned crude oil.

My understanding is that oil must go to US or European refineries and cannot be sold elsewhere. It is also expected that the volume of oil that “Eni” and “Repsol” Will receive, be relatively low and have minimal impact on oil prices worldwide. There is an urgent need for more oil to help Europe fill the demand gap.

Do you see a connection between the US government’s decision and the upcoming congressional midterm elections?

I do not think there is any direct connection between the Venezuelan agreement and the US midterm elections. However, Joe Biden can decide that the need for an unprecedented reduction in fuel prices before the November midterm elections outweighs the benefits of tighter sanctions against Venezuela and Iran.

What worries US voters is rising living costs, insecure streets, and the pending Supreme Court ruling on abortion, and how to handle the Ukraine war and growing tensions with China. Inflation is one of the most common issues in the minds of voters when buying groceries, filling up gas tanks or paying home heating bills. There is no escaping it and it will continue to be one of the most important issues until there is significant relief in the next few months.

So far, Ukraine has not become a dominant US political issue, in part because of its support for Ukraine and its support for US assistance on both sides. Also, the praise that Biden has received from the Foreign Policy Institute or its European allies has not turned into positive marks for his overall management of national security issues. But no one is willing to predict where this will go next fall.

Q: If the war in Ukraine continues and no agreement is reached in Vienna, is it possible that Iran’s oil exports will increase?

For the same reasons I said for Venezuela, I believe that the United States may not block the entry of Iranian sanctioned oil into world markets, even in the absence of a revival of the 2015 nuclear deal. Negotiations between Tehran and world powers have stalled since March, as the new deal limits Iran’s nuclear activities and reduces US sanctions on its energy exports. We are increasingly pessimistic that negotiators will reach an agreement.

If the midterm congressional elections need to lower the price of gasoline in the United States, ignoring the exit of the sanctioned barrels is probably what you expect to see.

Iran has increased oil exports this year, most of them to China. A new nuclear deal would allow 500,000 to 1 million barrels of oil a day to enter international markets, enough to put pressure on prices. Iran also has about 100 million barrels of oil in stock that can be sold quickly.

While many Republicans and some Democrats oppose lifting sanctions on Iran, Biden is under intense pressure to cut gasoline prices, which have averaged more than $ 4.80 a gallon in the United States.

Now that the Ukraine crisis has increased the West’s need for Iran’s energy sector, Iran may decide to seize the opportunity posed by instability in global energy markets and raise its demands at the Vienna nuclear talks. Iran and the United States may also provide “economic, technical and political” guarantees that the country will not violate its 2015 nuclear deal with world powers such as 2018.