The Iran Deal Is Dead; Here’s What That Means for Crude Oil Prices

Several months ago, U.S. President Donald Trump delivered an ultimatum on the Iranian nuclear deal:

“Either fix the deal’s disastrous flaws, or the United States will withdraw.”

Despite clear support from French President Emmanuel Macron, German Chancellor Angela Merkel, UK Prime Minister Theresa May, and the European Union to continue the Joint Comprehensive Plan of Action (JCPOA), popularly known as the “Iran nuclear deal,” and offset a Trump veto, the deal, as it existed on Monday, is now dead.

The stakes are high, but European positions are not enough.

Short term, oil-pricing volatility will continue. Traders will likely consider any forward interruption – perceived or actual – in Iranian crude export flow as upward pressure on global prices.

If this happens and JCPOA is not immediately closed, (i.e., should those second and third possible scenarios I mentioned play out), there will be a pullback.

Overall, other factors have been contributing to an increasing floor for the oil-pricing band, supported by continuing OPEC production problems in Venezuela, Nigeria, and Libya.
more at: https://moneymorning.com/2018/05/09/the-iran-deal-is-dead-heres-what-that-means-for-crude-oil-prices/

Related Posts

Oil Advances on Signs U.S. Stockpile Gains Easing After Harvey

Futures climbed as much as 1.3 percent in New York after declining 0.9 percent Tuesday. Inventories expanded by 1.44 million barrels last week, the American Petroleum Institute was said to report. That’s less than half the projected 3.9 million-barrel increase the government is forecast to report Wednesday. Some U.S. refiners are delaying maintenance to take advantage of strong margins. While oil has rebounded the past two weeks, crude in the U.S. has struggled to hold above $50 a barrel as prices beyond that level make some shale profitable and boost supply. At the same time, the Organization of Petroleum Exporting Countries and its allies are said to be discussing extending by more than three months the output cuts that expire in March. Iraq, the group’s second-biggest producer, has said production should be reduced by an additional 1 percent to help rebalance the market. Click Read More below for additional detail.

Oil Firms as U.S. Gulf Refineries Restart, Dollar Softens

Brent oil prices firmed on Thursday, hovering near 3-1/2-month highs as U.S. refiners restarting after Tropical Storm Harvey increased their crude processing and the U.S. dollar declined. Brent crude futures LCOc1 were up 28 cents at $54.48 a barrel by 1143 GMT, close to their highest since May 25. U.S. West Texas Intermediate (WTI) crude futures CLc1 eased by 11 cents to $49.05 a barrel, near a four-week high.
Back To Top
×Close search
Search