In 2017 the oil prices will stay above $50 per barrel, analytics said. The markets are not greedy for the oil. Purchasers calculated their profit from the deals in the period of lower prices, however everyone considers the impact of several OPEC members, who escaped the cutoff. Iran is number one in the list. Also the USD is expected to grow up under the effect of the Fed rate hike, so the oil prices will be pushed down by the USD value.
During the last decade the Middle East and Persian Gulf became an arena of revolutions, rebellions and ongoing wars. The East was coming closer to the West, intellectuals dreamed of those days. Meanwhile, there were more things in the earth, than were dreamt of in their philosophy. The oil fields in Libya, Syria, Iraq were transformed into the battlefields. Iran has been surviving under sanctions and sold the oil to Asian markets; Russians collaborated with the Iranians and benefited thanks to Persian oil as well. So the oil resources were well known, the shale oil was not considered as a serious competitor for the easy-to-get Eastern black gold. Why do we recollect the Arabian spring? For the only reason – to clarify the exceptions of the recent cutoff OPEC policy. Libya and Iran have lost profit because of war and sanctions, Iraq was purported to be included in the list. However, it was Nigeria, who was allowed to increase production owing to the rebels, fighting close to the main pipeline in the Niger delta. Libya and Nigeria continue to perform their part in the OPEC orchestra.
Thus, what do we have in the oil markets right now? The uprising ask and slowly decreasing bid because of the OPEC deal, supported by non-OPEC exporters. Purchasers carefully watch the Iran and calculating the speed of the American shale oil production recovery. Therefore, it is Iran, who spoils the optimistic forecasts in 2017. Since October 2016 Tehran has sold 13.2 million barrels from the tankers, according to Thomson Reuters Oil Flows data. From January to October 2016 the amount of Iranian oil held at sea had barely changed, the data showed. The oil from Iran was bought by Asian countries, including China, India and South Korea, but Italy and France purchased it as well. Tehran is seeking new markets in Europe, offering aggressive discounts to replace Moscow.
Thus oil prices are moving up, but no one believes in the smooth rise.