Fitch expects oil surplus and return to $50-60-barrel price level as related to new sanctions against Iran

Beijing. May 11. Silkroadnews - Fitch Ratings expects oil surplus and return to $50-60-barrel price level as related to new sanctions against Iran, the Kazakh Telegraph Agency (KazTAG) reports with reference to TASS.
The chances for further extension of OPEC+ deal are being reduced as related to imposing sanctions against Iran and implying restrictions on the Iranian crude export. Along with the growth of shale production in the US, this could lead to a new surplus in the oil market and return of the oil price to the level of $ 50-60 per barrel, the experts of Fitch agency forecast.
According to analysts, the US decision to impose sanctions against Iran theoretically leads to a situation of oil shortage in the market. If this is the case, oil prices will stay above $70 per barrel, experts say.
However, in their opinion, such a high level will not last for long, as the majority of oil producers have been adapted to oil prices at $50-60 per barrel. Besides, oil output growth in the US reduces the chances to extend the OPEC+ deal beyond 2018. But even without this, OPEC+, most likely, will be forced to reconsider the current agreements on oil output restriction, if this is the scenario, prices are likely to return to levels of $50-60 per barrel, the report said.
In general, Fitch expects to continue its conservative forecast for prices for this year at $57.5 per barrel.