Tags: 2 | gas | sanctions | iran | lifted

$2 Gas May Be Back as Sanctions on Iran Are Lifted and Oil Flows

By    |   Wednesday, 15 Jul 2015 07:51 AM

Gas prices may fall as low as $2 a gallon as a result of longstanding sanctions being lifted on Iran.

According to CNN Money, most major Western countries imposed trade sanctions on the terrorist-sponsoring nation over the last five years, and the U.S. in particular has not purchased oil from Iran since 1995.

 


Now that the U.S. and other Western countries have reached a deal with Iran over its nuclear program, oil is expected to start flowing into the global market by the fall.

"Once we get past Labor Day, we should see gas falling by 10 to 15 cents a month," said Tom Kloza, chief oil analyst with the Oil Price Information Service. "By December a lot of places are going to see gasoline at $2 or less."

Naeem Aslam, chief market analyst at Ava Trade, echoed this sentiment.

"[Iran] will only add to the oil glut on the market and increase the selling pressure," he said, alluding to the oil boom generated by the U.S., OPEC nations, Russia and Iraq.

By the end of the year, Iran — estimated to have as much as 30 million barrels of crude in storage and ready for sale — could add 500,000 barrels of oil per day to global markets. In addition to the European countries involved in the Iran nuke deal, if the U.S. gives a final seal of approval this fall — President Obama has vowed to veto any objections from Congress — Iran could add 800,000 barrels to the global market per day.

In addition to the glut of oil the global market is currently experiencing, economic problems in China and Europe have decreased global demand somewhat, adding even more downward pressure on gas prices.

 


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Gas prices may fall as low as $2 a gallon as a result of longstanding sanctions being lifted on Iran.
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Wednesday, 15 Jul 2015 07:51 AM
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