[PRIMER] JMMC slated to start at 12:00BST/07:00EDT with the decision-making OPEC+ confab penciled in for 13:30BST/08:30EDT

Analysis details (08:51)

OVERVIEW: The meetings will take place against the backdrop of a deteriorating COVID situation in Asia, longer-than-expected Iranian nuclear talks, and heading into a less COVID-restricted summer period, with the US driving season also looming. Recent sources have suggested that OPEC+ is likely to stick to the existing plan at today’s meeting to observe the Iranian situation – with JCPOA talks looking to spill over into a sixth round. Markets will also be on the lookout for any hints as to the trajectory of output beyond July – although ministers are unlikely to tie their hands given the fluidity of the supply/demand balance.  ING believes that the oil market can handle Iranian oil alongside OPEC+ supply, "We are assuming that Iranian supply returns to 3MMbbls/d by 4Q21”, and thus expect the group to stick to the current deal.

CURRENT DEAL: Under the current OPEC+ quotas (set in April), June, and July are poised to see 700k BPD (350k OPEC+ and 350k Saudi) and 850k BPD (450k OPEC+ and 400k Saudi) of oil re-entering the market respectively.

RECENT COMMENTARY: Since April, the COVID situation in India has continued to deteriorate but focus on this meeting, among analysts at least, is seemingly on Iran. Russian Deputy PM Novak noted that OPEC+ is to consider Iran’s return to the market and it is unclear if Russia is ready to make room for Iran. Comments made by the Iranian Oil Ministry yesterday suggested a swift increase in the country’s output to 6.5mln BPD from the most recently reported 2.5mln BPD – although energy journalists and analysts argue that such a ramp-up would require immense investments – something that investors currently do not have the appetite for. There were also reports last month that the National Iranian Oil Co. is priming oil fields for a rapid increase of exports should a deal be reached - "In the most optimistic estimates, the country could return to pre-sanctions production levels of almost 4 million barrels a day in as little as three months.", the report stated.

01 Jun 2021 - 11:30- EnergyResearch Sheet- Source: Newsquawk