World Bank expects reduction of oil price by $10.00 after lifting of sanctions from Iran

World Bank (WB) experts believe that US, EU, China, India and Turkey will benefit most of all from resumption of trade with Iran.

A WB forecast reads that as soon as sanctions imposed on Iran are lifted, inflow of oil to the world market will increase by about 1 million barrels a day. According to WB experts’ estimates, return of the Iranian oil to the market will lead to reduction of average price by about $10.00 during 2016 (from $66.00 to $56.00) and will also negatively affect incomes of budgets of the biggest oil exporting countries.

In particular, reduction of Saudi Arabia’s incomes from oil export is estimated by WB experts at $40 billion a year and the similar losses of Libya – at $5 billion. According to WB, Iran will increase its incomes, because it will benefit more from increase in the oil export, than lose from reduction of oil prices.

WB experts also expect that as soon sanctions against Iran are lifted, the flow of direct foreign investments into the country’s economy could be significantly increased. In 2016-2017 they could total $3-3.2 billion, which is twice as much against the current level. The Iranian authorities evaluate demands of the oil and gas market till 2020 at $130-145 billion.—0—