From S&P Global Platts, June 7:
Asia's anticipation of Iranian crude inflows returning tops this week's pick of market trends. Plus, Carbon prices and global climate politics, Henry Hub gas prices, Indian power demand, and Chinese toluene and xylene market indicators.
1. Asia hopes it can revive love affair with Iranian crude sooner than later
What's happening? Asian refiners are planning in advance to renew their love affair with Iranian crudes and fill a partial vacuum of medium and sour grades the global oil market has witnessed over the past two years, as hopes rise that Washington would likely lift sanctions on Tehran.
What next? Although there is still no clear indication on the possible final outcome of the Washington-Tehran talks, there is growing optimism the floodgates for Iranian oil will open up later this year. That is expected to potentially widen the Brent/Dubai spread, redraw demand-supply balances for light versus heavy crudes, and set the stage for a battle with rival Middle East producers. Medium and heavy sour crudes have been in short supply in recent years due to sanctions on Iran and Venezuela, as well as production cuts implemented by OPEC. Traders said any easing of sanctions would weigh on spot differentials for other Middle East crude grades. An economy battered by sanctions, Iran will be keen to increase exports and win back customers by adopting a prudent pricing strategy, traders said....
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