The likely easing of sanctions on Iran is one of several downside risks to global oil prices over the remainder of the year. Admittedly, it may not be until 2016 before Iran can meet its side of any comprehensive agreement with the Western powers, so a surge in supply would not be imminent. Nonetheless, we expect exports from Iran to increase by 1 million barrels per day pretty quickly thereafter. The anticipation of this increase could have a significant impact on an already over-supplied market, especially with output from US shale set to recover too.
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