TRUMP EXPECTED NOT TO CERTIFY IRAN COMPLIANCE WITH NUCLEAR PACT
President Donald Trump is set to refuse to certify that Iran is in compliance with the 2015 international nuclear agreement, which Mr. Trump has called “the worst deal ever.”
Mr. Trump isn’t expected to ask Congress to re-impose sanctions on Tehran that were lifted as of part of the deal. Iran significantly boosted its oil production after punitive measures against the nation were removed in early 2016.
However the Trump administration may designate the Islamic Revolutionary Guard Corps, Iran’s elite military branch, as a terrorist organization.
Iran has vowed a “crushing” response if the U.S. takes that step.
Investors have largely priced-in the risk premium on Iran and oil prices should not waver too much following Mr. Trump’s decision, say analysts
But “the bullish surprise would be the classification of the Revolutionary Guards as a terrorist organization,” said Olivier Jakob, managing director at oil consultancy Petromatrix.”Doing so would have an economic impact for Iran.”
Mr. Trump’s decision may make it more difficult for U.S. Navy boats to travel through the Strait of Hormuz, which is also patrolled by Iran.
A sizable portion of the world’s seaborne oil shipments pass through the 20 mile wide channel in the Middle East.
Earlier in the year an Iranian Navy vessel confronted three U.S. ships and pointed a laser at a Marine Corps helicopter over the Strait of Hormuz
Oil prices jumped Friday on a mix of factors, including bullish Chinese data and geopolitical risks from oil-rich regions in the Middle East.
Brent crude, the global benchmark, was up 1.87%, at $57.30 a barrel on London’s Intercontinental Exchange.On the New York Mercantile Exchange, West Texas Intermediate futures gained 1.64% to $51.43 a barrel.
SAY GOODBYE TO $30 OIL AS SUPPLY GLUT IS MOSTLY GONE, SAYS PLATTS
OPEC might be closer to working off a supply glut than it thinks, says Gary Ross, head of global oil analytics at S&P Global Platts.
Brent crude, the global benchmark, is likely to top its 2017 high of $59.02 a barrel before the year’s end, Mr. Ross predicted speaking to reporters at a conference in New York.
“We think with the surplus stocks are mostly gone–we’re not going to see $30 oil anymore,” he said. “We’re basically in a $50 to $60 Brent world for the time being,” he said.
CHEVRON LOSES TASTE FOR OIL IN GREAT AUSTRALIAN BIGHT
Elsewhere, Chevron Corp. has abandoned plans for deep-water exploration wells off Australia’s southern coast, the second oil major to be squeezed out of the Great Australian Bight, citing low oil prices, writes Robb M. Stewart.
“The U.S. company said its exploration program in the Bight had failed to compete for capital against other projects in its global portfolio. It follows BP PLC’s decision a year ago to halt its own exploration efforts there, saying the project didn’t stack up financially,” the Journal reports.