A British man is on board a cargo ship seized by Iranian authorities. He is one of 24 crew members on the Maersk Tigris, which was in international waters crossing the Strait of Hormuz en route from Jeddah in Saudi Arabia to Jebel Ali in the UAE when it was approached and seized by Iranian patrol boats. A spokesman for Denmark-based Maersk said they understand the “crew is safe and under the circumstances in good spirits”. A statement added: “We are continuing our efforts to obtain more information about the Iranian authorities’ seizure - in international waters - of Maersk Tigris. We are not able at this point to establish or confirm the reason behind the seizure.
As Russian President Vladimir Putin has shown in Crimea and eastern Ukraine, he’s willing to take an economic hit to expand his political influence. He’s taking the same approach with Iran. Lifting sanctions and allowing Iranian oil onto global markets would threaten to deepen the plunge in crude prices, curbing revenue from Russia’s biggest export. The cost: about $27 billion, based on estimates from the central bank in Moscow. “The strategic benefits are much more important for Russia,” said Nikolay Kozhanov, an expert at the Royal Institute of International Affairs in London and a nonresident fellow at the Carnegie Moscow Center. “Incorporating Iran into pro-Moscow organizations, Russia is hoping to secure its share in this market or divide zones of influence.”
Oil held gains after a fourth weekly increase as skepticism among US lawmakers over a nuclear deal with Iran signaled a recovery in the OPEC producer’s crude exports may be delayed. Futures were little changed in New York after rising 5.1 percent last week. President Barack Obama is dispatching three cabinet members to brief lawmakers as a Senate committee prepares to take up a bill that will give Congress 60 days to review any final agreement with Iran.
Iran and world powers took their biggest step toward ending a decade-old nuclear standoff, saying they agreed on the main outlines of an accord after more than a week of grueling talks. The deal announced in Lausanne, Switzerland on Thursday doesn’t commit either side to immediate action, and leaves three more months for diplomats to fill in details. But by outlining areas of consensus, from a timetable for lifting sanctions to the repurposing of Iranian nuclear facilities, it brings the Islamic Republic closer than at any time since the 1979 revolution to international normalcy. President Barack Obama called it an “historic understanding,” and the International Atomic Energy Agency said it was ready to verify Iran’s actions. There were early signs, though, that the next steps won’t be easy.
Iran and world powers extended talks aimed at ending the 12-year standoff over the Islamic Republic’s nuclear program into an eighth day with the US indicating progress toward an agreement. Diplomats negotiated all night in Lausanne, Switzerland and will reconvene at about 9:00 a.m. local time, US spokeswoman Marie Harf said. The US State Department said late Wednesday that enough progress had been made in meetings between Secretary of State John Kerry and his Iranian counterpart Mohammad Javad Zarif to warrant continuing talks.
Iran and world powers are weighing compromises in order to overcome a deadlock in nuclear talks with little more than 12 hours to reach an agreement. “We’re in a bit of a crisis with the talks; perhaps we have a bit of a new approach, we will see,” Frank-Walter Steinmeier told reporters on Tuesday. Russia’s Foreign Minister Sergei Lavrov said in Moscow that there’s still a good chance the sides can overcome their differences before the deadline. An understanding can be reached “as long as none of the participants at the talks raise their stakes at the last moment,” Lavrov said at a press conference prior to returning to Lausanne, Switzerland, where the negotiations are taking place. The effort to end a 12-year standoff has negotiators still divided over the pace of easing sanctions on Iran, and the limits to be imposed on its research to ensure it can’t obtain nuclear weapons.
Outside the boardroom of BP Plc’s headquarters on London’s swanky St. James’s Square, a display case houses the geological data from Masjid-i-Solaiman, Iran’s first oil well. The discovery of crude in 1908 laid the foundations for the company that would become British Petroleum and opened one of the richest opportunities that western oil companies have ever enjoyed in the turbulent Middle East. Since then, the industry’s history in Iran is intertwined with CIA-backed coups, colonial exploitation and the anti-western resentment surrounding the 1979 Islamic Revolution.
Lifting oil sanctions on Iran could hit global markets long before the nation starts pumping more crude. That’s because the OPEC member has been stockpiling oil onshore and in supertankers in the Persian Gulf, according to data compiled. While estimates of the hoard by shipbrokers and government officials vary from as little as 7 million barrels to as much as 35 million, Barclays Plc and Societe Generale SA predict this crude would be first to be sold abroad if there’s an agreement on Iran’s nuclear program.
Asian oil buyers taking their pick of supply from Iraq to Mexico amid a global glut are preparing for the pool of potential bargains to expand if Iran boosts exports. As world leaders seek an accord on Iran’s nuclear program, at least six Asian refiners including India’s Mangalore Refinery and Petrochemicals Ltd. and Japan’s Cosmo Oil Co. are anticipating more supply from the Middle East producer if sanctions against the nation are lifted. While global producers seek to defend market share as oil prices trade near a six-year low, buyers in Asia are diversifying their crude sources by shipping cargoes from as far as Colombia.
Iran says it could add a million barrels to daily oil production shortly after a deal to lift sanctions is reached, reclaiming the position of OPEC’s second-largest supplier. While the timing of such a move would be at least months away because the sanctions would be rolled back slowly, industry observers largely agree that the capacity is there. Yet going further than that and adding a second million barrels -- as the government has said it plans to do -- will prove a much bigger challenge.
Iran is said to be offering its main crude grade to customers in Asia at the deepest discount in 14 years, taking a cue from Saudi Arabia in trimming price differentials. National Iranian Oil Co. cut its official selling price for January shipments of light crude to Asia to a discount of $1.80 a barrel below the regional benchmark as Middle Eastern producers vie to keep selling in the region, according to four people with knowledge of the decision. An official at NIOC’s crude-marketing department in Tehran declined to comment.
Brent resumed its decline as an Iranian official predicted a further slump in prices if solidarity among OPEC members falters. West Texas Intermediate in New York also erased yesterday’s gains. Futures slid as much as 1.6% in London after snapping a five-day losing streak. Crude could fall to as low as $40 a barrel amid a price war or if divisions emerge in the Organization of Petroleum Exporting Countries, said an official at Iran’s oil ministry.