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Many analysts expect that he will not waive the sanctions this time, although the impact on Iranian oil exports is hard to quantify and it is hard to predict when possible sanctions would kick in.

Iran, the third-largest oil producer in OPEC after Saudi Arabia, is now producing around 3.82 million b/d of crude oil, according to Platts estimates.

Sources said Turkey's purchases of Iranian oil are likely to be strong even if sanctions are re-imposed but that might not be the case for some of the countries in the EU. The survey of 38 economists and analysts forecast Brent crude would average United States dollars 67.40 in 2018, more than 5 percent higher than the $63.97 projected in the previous month's poll.

OPEC shrunk its production by about 1.2 million barrels as part of a deal with Russian Federation and other non-OPEC producers to overcome oversupply.

"There will be a significant disruption", said Michael Wittner, global head of oil research at Societe Generale.

In the short term, however, we can expect that Iran will simply redirect its oil trade from the West to the East if heavier sanctions are reimposed.

The United States has questioned Iran's sincerity in implementing the nuclear curbs and President Donald Trump has threatened to reimpose sanctions if adjustments are not made to the agreement.

For U.S. supply growth heading into 2018, See and his team had expected "well over 1 million barrels".

Michal Meidan, head analyst for Asian energy policies and geopolitics at research consultancy Energy Aspects told CNBC late a year ago, "I think the USA certainly is poised to capture a lot of that growth".

The oil market certainly thinks it knows.

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U.S. West Texas Intermediate crude for June delivery finished Tuesday's session down $1.32 a barrel, or 1.9%, at $67.25/Bbl, after settling up 47 cents Monday, Kallanish Energy reports.

"The Iranian nuclear deal is dead in the water and a Trump torpedo is fast approaching", Stephen Brennock, oil analyst at brokerage firm PVM Oil Associates, wrote to clients late last week.

Under the 2015 nuclear deal, Iran agreed to limit its nuclear activities, in exchange of lifting sanctions against the country.

The rising inventories are in part a result of soaring USA production, which has jumped by more than a quarter in the last two years to 10.6 million barrels per day (bpd), making the United Statesthe world's number two Crude OilProducerbehind only Russian Federation, with 11 million bpd. South Korea and Japan are Iran's other key customers in Asia where 60 percent of Iranian oil is exported.

According to FEG estimates, if the sanctions are restored, Iran's output could be slashed by 250,000 to 50,000 barrels per day by the end of 2018.

Traders are also looking ahead of USA inventories data.

The balance between production, consumption and inventories is intimately connected with the shape of the oil futures curve.

For the record, USA president Donald Trump will make his decision whether or not to scrap the Iranian nuclear deal on or before May 12.

Oilprices were stable on Wednesday, supported by concerns that the United Statesmay re-impose sanctions on major exporter Iran, although soaring USA supplies capped gains.