The nuclear deal will not affect oil prices, expert says

Shafaq News / Iraqi expert, Hamza al-Jawahiri, said that the Iranian nuclear deal will not affect oil prices.

Al-Jawahiri told Shafaq News agency, "if the US and Iran agree on the nuclear deal, oil prices won't collapse", adding, "these prices might be slightly affected for a short period, to resurge again in no time."

"Iran did not stop exporting oil when it was sanctioned. It sells oil to many countries, including India and China, in several ways. The market requires oil supply, especially during the economic system's recovery following COVID-19", he added.

Oil slipped towards $90 a barrel on Tuesday ahead of the resumption of indirect talks between the United States and Iran, which could revive an international nuclear agreement and allow more oil exports from the OPEC producer.

A deal could return more than 1 million barrels per day (bpd) of Iranian oil, equating to more than 1% of global supply, to the market. The nuclear talks are due to resume in Vienna on Tuesday.

"If sanctions against Iran are lifted, global crude oil supply may receive much-needed support," said Naeem Aslam, chief market analyst at Avatrade.

Eight rounds of indirect talks between Tehran and Washington since April have yet to result in an agreement on a resumption of the 2015 nuclear pact, with differences remaining over the speed and scope of the lifting of sanctions.

"Exports could resume swiftly if a nuclear deal is reached," said Tamas Varga of broker PVM. "But it is a big 'if'. The re-emergence of Iranian barrels is only a possibility at this stage."

Brent crude was down $2.02, or 2.2%, at $90.67 a barrel by 1110 GMT after hitting a seven-year high of $94 on Monday. U.S. West Texas Intermediate crude fell $1.60, or 1.8%, to $89.72.