MNI Commodity Analysis: Sanctioned Barrel Outlook Under Question in 2024

Executive Summary:

• Iran has ratcheted up tensions against the west post October 7 Hamas attacks in Israel, most recently culminating in an attack on US personal in Jordan by its proxies, soon expected to provoke a response from the Biden Administration – leaving oil markets tense.
• The US appears limited in clear options it can take against Iran. Strikes remain unlikely over fears of escalation, while rampant oil flows from the sanctioned nation in 2023 shows the inability to stifle a key funding source.
• Lower Russian oil availability post OPEC+ cuts and Venezuelan barrels now heading to the US Gulf/India have prompted Iran to increase prices for China teapots – something they have been rejecting in recent months.
• Venezuela treads a fine line over its Barbados deal that facilitated temporary US sanctions relief until mid-April. Progress to-date towards fairer elections in Venezuela has proved insufficient, leading to US threats of energy sanction reimposition in the coming months – bearish for US refiners but bullish for China’s teapots.

MNI Commodity Analysis - Sanctioned Barrel Outlook Under Question in 2024.pdf