16 July 2021
Behind the oil price hike, global oil demand has followed an uptrend amid the global economy’s recovery from the COVID-19 disaster, while the future of coordinated oil production cuts by the Organization of the Petroleum Exporting Countries and non-OPEC oil-producing countries has become uncertain due to a dispute between Saudi Arabia and the United Arab Emirates. [...] The first impressive point in the Sakanashi report is that the situation would change depending on whether the United States and Iran would reach agreement on the nuclear deal under the current Rouhani administration. [...] In a debate on an argument that new President Raisi would give top priority to the survival of the Iranian regime, a participant in the session noted that a grave challenge for the new president would be how to respond to major changes in Iran’s internal and external situations while reviewing the history from the Islamic Revolution to date and recognizing the strength of Iran and its regime. [...] For the other scenario, the report projects the Brent futures price to range from $70/bbl to $90/bbl in the second half of 2021 and from $65/bbl to $85/bbl in 2022 as the OPEC-plus group gradually narrows coordinated production cuts through its continuous micro management of the supply-demand balance. [...] For the sanction-lifting scenario, the Brent futures price is projected to decline briefly in anticipation of Iran’s comeback to the international oil market before rallying to the above forecast ranges.