Record oil prices: possible decline

On Thursday this week, oil prices rose to nearly $120 a barrel, the highest in a decade. The reason for this was the sanctions and restrictions on the sale of Russian oil. An opportunity to dampen the rise in prices could be the successfully completed nuclear deal with Iran, which could increase additional supplies.

Brent rose to $119.84 a barrel, with data showing U.S. crude inventories reaching multi-year lows playing a special role. At the same time, over the past month, Brent oil has jumped by more than a third.

The price of oil in the US reached $116.57, its highest since 2008, before falling to $109.66 after an Iranian reporter announced a breakthrough in talks to restart the Iran nuclear deal.

Russia, which rivals Saudi Arabia as the world's largest exporter of crude oil and petroleum products, ships more than 7 million bpd, with about half going to Europe. Washington and its Western allies have imposed sanctions on Russia, but these measures have not yet targeted Russian oil and gas exports directly. At the same time, international traders are still afraid of being under sanctions – on Wednesday, about 10 tankers were not sold.

Russian oil exports are expected to fall by 1 million barrels per day due to the indirect impact of sanctions and voluntary withdrawals by companies. At the same time, oil prices are likely to continue rising to $130 per barrel.

On Wednesday, the organization of the oil exporting countries, Russia and its allies, a group known as OPEC+, decided to stick to its existing plan to gradually increase production by 400,000 bpd in a month.