Since the increase in Iran’s output will occur steadily rather than one sizeable step change up, we do not see a large-scale downward effect on oil prices. The government data showed that United States oil stockpiles fell by 4.3 MMbbls (million barrels) for the week ended July 10, 2015. The WTI price slumped to around $52.55 (down about 1.7% for the day) shortly after the report was released.

Crude stocks at the Cushing, Oklahoma, delivery point for the US crude contract have risen almost 1 million barrels since last Friday, according Genscape data, trading sources said.

Benchmark US crude dipped 54 cents Monday to settle at $52.20 a barrel on the New York Mercantile Exchange. Details of the condition of Iran’s production infrastructure are sketchy, but with limited investment as sanctions have been increased it is likely that only a portion of this capacity can be brought back on-line without material investment. A growing market for oil storage does not necessarily translate into a tanker boom.

Since Iran has the fourth-largest proven crude oil reserves, everyone’s wondering what Iran’s re-entry on the global market means.

Oil futures slid Wednesday as markets started to price in the impact on supplies of Iran’s historic deal with Western powers regarding the Islamic republic’s suspected nuclear ambitions.

Outside of the cartel, non-OPEC countries will probably put out a combined 300,000 barrels a day next year, down from 860,000 barrels a day this year. The commodity slumped to a more than 3-month low as traders priced in the bearish outlook, given the expectations of increased exports from Iran amid the poor demand picture.

Even 500,000 bpd extra on the world market would most likely depress prices considerably, especially if other producers kept output at current levels. The British pound hit a fresh seven-year high against the euro after Bank of England Governor Mark Carney on Thursday suggested a rate hike may come sooner than markets expect. As a result, oil prices declined. The agency added that: “The market’s ability to absorb that oversupply is unlikely to last”.

Olivier Jakob, head of Swiss energy consultancy Petromatrix, said USA oil demand remained very strong, driven by gasoline consumption, which was helping keep USA refineries working at full tilt through the northern hemisphere summer.

If Iranian oil is slow to return to the global market and volumes disappoint, then the flattening in the futures curve of recent months looks overdone. Prices are 2.9 percent lower for the week.