Unrests in Iran could push oil prices up| MENAFN.COM

Wednesday, 01 February 2023 09:10 GMT

Unrests in Iran could push oil prices up


(MENAFN- Trend News Agency ) Baku, Azerbaijan, Jan. 9

By Leman Zeynalova – Trend:

The unrests in Iran should not have a lasting and very significant impact on the global oil market, but these tensions may have an indirect effect on oil prices, Francis Perrin, Senior Fellow at the OCP Policy Center (Rabat) and Senior Research Fellow at the French Institute for International and Strategic Affairs (IRIS, Paris), told Trend.

"Protests in Iran have pushed oil prices upwards in the recent days with North Sea Brent reaching $68 per barrel on Jan.4 on Asian markets. But these tensions should not have a lasting and very significant impact," said the expert.

There has been so far no negative impact on Iran's crude oil production, which is stable at 3.8 million barrels per day, exports (higher than 2 million barrels per day) and energy facilities and infrastructure, said the expert, adding that he doesn't expect any problems in the Iranian oil and gas sector in the near future.

"We have however to take into account a possible indirect impact of Iran's internal political situation. Due to these protests and to deaths and arrests in several large Iranian cities, the Trump administration, which has already hardened its stance against Tehran, could decide to impose new sanctions against Iran," Perrin believes.

He pointed out that in about 10 days, President Trump will have to certify or not the Vienna agreement of July 2015 about the Iranian nuclear program.

"If, and it is a big if, the US decides to impose sanctions related to the energy sector, it would have a negative impact on foreign investment in Iran. As Iran is a country with a very strong oil and gas potential, delays and obstacles to foreign investment in the hydrocarbons industry and to financial flows towards Iran could push oil prices up, as it would prevent Tehran from increasing its production and exports as anticipated in the medium-term," the expert concluded.

Iran saw turmoil and political unrests over the past week, which took the lives of at least 22, including security forces.

The unrests began after some groups joined demonstrations in a number of cities, including the capital Tehran, Mashhad and Kermanshah to protest against high prices, but the economic protests soon turned into anti-government demonstrations.

The government officials have urged people to refrain from participating in the illegal protests.

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