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Energy trader Vitol will stop doing business with Iran after the United States re-imposes sanctions on Tehran’s oil trade from Nov. 4. a senior company executive said on Tuesday.
“Business with Iran or anything to do with Iran has to come to an end.“ said Mike Muller. who handles business development for Vitol. on the sidelines of the Asia Pacific Petroleum Conference (APPEC) in Singapore.
“We have a long-standing relationship with Iran and clearly I look forward to when trade can be resumed. but for now. one needs explicit waivers from the U.S.. and not just the U.S. but the global banking community and everything else.“ he said.
The United States announced in May that it would re-impose sanctions on Iran. the third-largest producer in the Organisation of the Petroleum Exporting Countries. to force the country to renegotiate an agreement limiting Iran’s nuclear programme.
The sanctions started on Aug. 7 with limitations on the country’s access to the global financial system and in November will be extended to Iran’s petroleum sector.
Some traders are forecasting that the sanctions could remove up to 1.5 million barrels per day of crude from the market.
Global benchmark Brent crude LCOc1 jumped more than 3 percent on Monday to a four-year high above $80 a barrel after Saudi Arabia and Russia ruled out any immediate increase in production despite calls by U.S. President Donald Trump for action to raise global supply. <.O R>.
Any push towards higher oil prices will need new drivers. with the current oil prices having already factored in market risks. Muller said in comments during APPEC.
“Anything leading to higher numbers will require some new evidence coming to light.“ he said.
Substantial additions of non-OPEC supply of up to 2 million barrels per day could flow to global markets next year. with half of that to come from the United States. he added.
He declined to provide an oil price forecast but his comments appear to be less bullish than commodity traders Mercuria and Trafigura who predicted $100 a barrel oil by early 2019 on Monday.
Separately. Muller added that a deal to acquire stakes in Nigerian offshore fields that are held by Brazil’s Petrobras and its partners. is not yet finalised.
“It’s a deal that’s going to be rather big for Vitol… there is a transaction being finalised.“ he said.
Reuters reported in June that a consortium led by Vitol has entered exclusive talks to acquire the assets which are estimated to be worth up to $2.5 billion (£1.9 billion).
