Oil Price Forecast: Get ready for $140 Brent

[dan_s]

Oil prices could jump to $140 a barrel due to the US sanctions against Iran and Venezuela, Iran’s OPEC governor Hossein Kazempour Ardebili told Reuters on Friday.

The Iranian official also criticized a U.S. request for Saudi Arabia to pump more oil so that it could cover a drop in Iranian exports was "crazy and astonishing" and said OPEC would not heed the appeal, setting the stage for a tough OPEC meeting this month.

Iran, Saudi Arabia's arch-rival, has a history of raising challenges in OPEC meetings. In 2015, Tehran refused to sign up to OPEC policies, saying it needed to hike output due to the easing of sanctions after a nuclear accord with world powers.

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In the previous round of sanctions against Tehran, in which the European Union had taken part, Iranian oil exports plummeted by more than half to below 1 million barrels per day.

The EU is not planning to join sanctions this time and has called on the United States to give its companies waivers so they can continue doing business with Tehran.

But many European companies are already severing ties with Tehran for fear of facing secondary sanctions from the United States, which could mean losing access to the U.S. dollar clearing system.

The U.S. sanctions on Iran's petroleum industry will take effect after a 180-day "wind-down period" ending on Nov. 4 but many European refiners are already winding down Iranian oil purchases.