Tokyo (Platts)--9Jul2015/300 am EDT/700 GMT

More than half of incremental Iranian crude exports will likely head to Asia when Western economic sanctions against Iran are lifted, a senior oil analyst at the Institute of Energy Economics, Japan said Thursday.

Yoshikazu Kobayashi, oil group manager at IEEJ's fossil fuels and electric power industry unit, said "30-40%" of the incremental Iranian crude exports will head to Europe with the balance coming to Asia.

Speaking at a press briefing in Tokyo, Kobayashi said Iranian crude exports will "definitely increase" over time if the world's six powers reach a deal with Iran in the next few days.

But Kobayashi said the incremental Iranian crude exports will be limited to around "slightly more than 100,000 b/d" this year as "it is unlikely the sanctions will be lifted immediately" even if a deal is reached.

Iranian crude exports however, could increase by a "maximum of 700,000-800,000 b/d over mid-2016 to end-2016," said Kobayashi, adding that international crude oil prices will fall by $10/barrel, when the market is fueled by additional Iranian oil.

Kobayashi said the international crude market saw a drop of around $10/b in Brent crude prices when Libya hiked crude exports by 700,000-800,000 b/d over late 2011 to early 2012.

Negotiations on a nuclear pact between Tehran and six world powers that could see additional Iranian oil flowing to global markets within months is extending past the July 7 deadline to Friday.

--Takeo Kumagai, takeo.kumagai@platts.com
--Edited by Irene Tang, irene.tang@platts.com

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