Reuters: Oil prices slump further as China lets Yuan slide.
Mehrnews title: Iran’s oil export liberated by US govt. statement
The above news are ambiguous for Iran’s oil price. The positive point is that U.S government has lifted ban on Iran’s oil exports following the signing of JCPOA in Vienna. So other countries can buy Iran’s crude oil, by expanding the supply of oil, Iran will increase its export capacity 500,000 within a week. The negative aspect is devaluation of Yuan and as a result, purchasing power of Chinese for dollar dependent commodities like oil will decrease. Higher cost of oil will lead to lower china’s import. Considering mentioned condition, in demand-supply equation, demand will reduce and the supply will increase so oversupply of oil will be happened. These analyses will take place in short term, but in long term due to Yuan devaluation the exports will grow more and potentially, the demand for oil as a raw material and fuel will be raised.
Numbers to prove the claims is shown in the Table below, global inventories grew by an average of 2.5 million barrels per day, 0.4 million b/d more than previous year. Consumption had an increase of 1.1 million b/d in relation to 2014 but its growth rate is smaller than production rate.
|Item||June 2015||July 2015||June July
|Global Petroleum and Other Liquids (million barrels per day)|
|Global Petroleum and Other Liquids Production (a)||96.5||96.4||96.4||93.2||91.6|
|Global Petroleum and Other Liquids Consumption (b)||93.7||94.1||93.9||92.8||91.3|
|Biofuels Production (c)||2.4||2.3||2.3||2.3||1.9|
|Biofuels Consumption (c)||2.1||2.0||2.1||2.0||1.9|
|Iran Liquid Fuels Production||3.5||3.5||3.5||3.3||3.4|
|Iran Liquid Fuels Consumption||1.8||1.8||1.8||1.9||1.9|
|Petroleum and Petroleum Products Produced and Consumed in Countries Other Than Iran (million barrels per day)|
|Production minus Consumption||0.9||0.4||0.6||-1.3||-1.3|
|World Inventory Net Withdrawals Including Iran||-2.8||-2.3||-2.5||-0.4||-0.3|
|Estimated OECD Inventory Level (e) (million barrels)||2,894||2,924||2,909||2,643||2,649|
|Surplus Production Capacity (million barrels per day)|
|OPEC Surplus Crude Oil Production Capacity (f)||1.4||1.3||1.4||2.0||2|