Will Iran Focus On Oil Rather Than Gas?

Despite the possible hurdles for Iranian gas exports to Europe, the International Energy Agency acknowledged the potential of Teheran. On Wednesday, the Paris-based organisation said that Iran could raise its oil output by as much as 730,000 barrels per day (bpd).

"While significantly higher production is unlikely before next year, oil held in floating storage - at the highest level since sanctions were tightened in mid-2012 - could start to reach international markets before then," the IEA wrote in a monthly report. 

Iran could take advantage of global oil market dynamics.  

‘Global oil demand in 2015 is expected to grow by 1.6 mb/d, up 0.2 mb/d from our previous Report and the fastest pace in five years, as economic growth solidifies and consumers respond to lower oil prices. Persistent macro-economic strength supports above-trend growth of 1.4 mb/d in 2016’ IEA forecasted. 

Iran and six world powers agreed on a deal in July aimed at curbing Tehran's nuclear programme. The next 5 months will tell whether the US Congress will ratify the agreement and when the sanctions would be eventually removed. 

Last week, Minister of Petroleum Bijan Zangeneh said that Iran will introduce its new oil and gas contracts during a conference to take place in London in December. 

On the other hand, natural gas export is a different story. According to a story published by the Financial Times on Tuesday, LNG, Azerbaijan and Russia are too much of an obstacle. The oversupply and the strong competition could put Iran off.