The EU embargo on imports of Iranian crude started on Sunday. The new US sanctions became applicable last Thursday. Market consensus appears to be that the new measures will cut Iranian supply to the market incrementally by around 1mmb/d; we expect the impact to be considerably less. Iranian crude production has been fairly stable since the start of the year, within a declining trend, which we believe reflects the real pressure Iran was already under. Iran has reportedly requested OPEC’s Secretary General, Abdalla El-Badri, to call for an Emergency Meeting now that oil is under USD 100/bbl. As Brent was below that level at the time of the last meeting on 14 June, we doubt that request will have much traction. Iran has also started to rattle its sabre again with a three-day military exercise and threats over transit via the Strait of Hormuz. We suspect that this will prove less price impactful than it was at the start of the year now that Saudi Arabia has made its pricing intentions clear, production has increased elsewhere within OPEC, inventories are more comfortable and we are in the middle of summer. Despite Iran’s bluster, we believe that the overall effect of the sanctions pressure has indeed brought it back to the negotiating table over its nuclear activities. The third in the current series of negotiations starts today in Istanbul, despite the new sanctions. Although these talks are at a lower level than previous rounds, the outcome will likely indicate whether any negotiating basis remains. We believe it is fairly probable that they will be extended. Total Brent non-commercial net long speculative positions increased 9,611 positions (+6.5%) WoW to 26 June, just ahead of the recent jump in price (Figure 2), albeit driven by Swap Dealer position rising while Managed Money fell.