EghtesadOnline: Oil Minister Bijan Namdar Zanganeh said Monday US sanctions on Iran and Venezuela plus the renewed military conflict in Libya are contributing to instability in the international oil markets.
"Oil prices witnessed a pattern of ascending order in the past three months indicating the fact that the market is in trouble," Zanganeh was quoted as saying by IRNA.
Warning about the consequences of mounting pressure on Tehran, the minister noted that although global supply and demand for crude is balanced by and large, the situation remains very fragile.
Oil prices have risen more than 30% since January on the back of supply cuts led by the Organization of the Petroleum Exporting countries and Russia, the tough US sanctions on Iran and Venezuela oil exports along with the escalating conflict in OPEC-member Libya, Financial Tribune reported.
Brent crude oil futures and US West Texas Intermediate (WTI) were at $71.44 and $63.63 a barrel on Monday respectively.
"Venezuela is in chaos. Russia is under sanctions. Libya is in turmoil and US oil production is slowing. This shows there is no guarantee that the market could stabilize and keep oil supply and demand balanced for long," the minister warned.
"If the US mounts pressure on us, the fragility could increase in an unpredictable manner.”
He is of the opinion that subjecting Iran to more hostility and economic pressure can increase gasoline prices in the United States.
"US President Donald Trump should decide to either impose more sanctions on Iran or fuel prices low at the pumps in his country," he was quoted as saying.
The US re-sanctioned Iran in November after pulling out of a 2015 nuclear accord the six world powers had signed with Tehran. The sanctions have halved Iranian oil exports as the major buyers of Iranian crude and others fear Trump’s wrath if they continue to do business with the Islamic Republic.
US President Donald Trump and his minions say they want to reduce “Iran’s oil exports to zero” and choke off Tehran's main source of revenue.
OPEC and its allies meet in June to decide whether to continue withholding supply. Though OPEC's de facto leader, Saudi Arabia, is seemingly keen on cutting, sources within the group say it could raise output from July if disruptions continue elsewhere.
The group's supply cuts have been aimed largely at offsetting record US crude production.