Energy Report: Trillions Of Reasons

There are a trillion reasons why OPEC plus wants to drive up prices. Mainly because it had been reported that OPEC plus lost over a trillion dollars due to the pandemic. Most OPEC plus producers view it as their right to drive up prices to get that money back and with the U.S. shale sector being held back, they will probably make that back and then some.

Iran sanction relief looks further out in the future if at all. Reuters reported that "Oil prices rose on Tuesday, settling at the highest in more than two years after the top U.S. diplomat said that even if the United States were to reach a nuclear deal with Iran, hundreds of U.S. sanctions on Tehran would remain in place. That could mean additional Iranian oil supply would not be re-introduced into the market soon.

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"I would anticipate that even in the event of a return to compliance with the JCPOA (2015 Joint Comprehensive Plan of Action), hundreds of sanctions will remain in place, including sanctions imposed by the Trump administration," U.S. Secretary of State Antony Blinken said. Brent crude rose 73 cents, or 1%, to close at $72.22 a barrel, the highest it has settled since May 2019. U.S. West Texas Intermediate oil rose 82 cents, or 1.2%, to settle at $70.05 a barrel, the highest since October 2018. Blinken is looking at the reality of the situation and saying even if we do get a deal, there’s a long way to go," said Phil Flynn, senior analyst at Price Futures Group in Chicago. "All those people expecting a flood of oil are going to be disappointed." 

The United States told Iran on Tuesday that it must let the U.N. atomic agency continue to monitor its activities, as laid out in an agreement that has been extended until June 24 or put wider talks on reviving the Iran nuclear deal at risk. Barriers to the revival of Iran's nuclear deal remain ahead of talks due to resume this week between Tehran and world powers, four diplomats, two Iranian officials, and two analysts told Reuters. So the oil market that expressed optimism that Iran’s oil would hit as demand ramps up this summer might now be faced with a looming shortage. With China still in maintenance, there may be some time to adjust but not much.

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