As President Barack Obama and new Iranian President Hasan Rouhani converge on the United Nations on Tuesday, energy market watchers are asking whether recent conciliatory gestures from Iran are genuine—and what they could mean for global oil.
Experts who spoke with CNBC said that Iran's efforts at some sort of rapprochement appear to be real, and for two very practical reasons: It's being economically strangled more than ever by coordinated, international sanctions, and it's staring at a credible U.S. threat of force over its nuclear program.
A highly anticipated, though officially unplanned meeting between the two leaders failed to materialize Tuesday when Rouhani was a now-show to a UN luncheon. But the new administration in Iran is giving the country the opportunity to reassess its foreign policy, and in effect to acknowledge that its attempts to counter sanctions have largely failed.
Rouhani wrote in an op-ed last week that world leaders "are expected to lead in turning threats into opportunities." He recently said as well that Iran will never develop a nuclear weapon, a statement Obama cited Tuesday as a sign of progress between the two countries.
Iran depends not only on oil revenue to sustain the political status quo, but also on foreign investment to maintain the domestic oil industry itself. Billions of dollars in foreign investment are required for the country's exploration and development efforts.