Oil looks to whole new world with Iranian oil

A Whole New World

The global oil market (NYMEX:CLZ13) is entering a whole new world. A world that many oil traders have never seen because it has been years since the market has not had to price in a high Iranian risk premium. Word that a deal is imminent that should allow Iran to sell its oil on the global market is already causing moves in the oil market place.  Brent crude will benefit and already Iran is trying to cement relationships to try to woo customers.

Fox News reports that:

Secretary of State John Kerry will fly to Geneva on Friday to participate in the negotiations between Iran and six world powers on a deal to cap some of the country's atomic programs in exchange for limited relief from sanctions stifling Iran's economy.  Kerry's visit comes as Iran's chief nuclear negotiator signaled progress at the negotiating table, saying the six had accepted Tehran's proposals on how to proceed, even as Israeli Prime Minister Benjamin Netanyahu called the emerging agreement the "deal of the century" for Iran.

A senior state department official said Friday that Kerry has been open to the possibility of traveling to Geneva for the talks "if it would help narrow differences." The official said European Union's top diplomat, Catherine Ashton, asked Kerry to attend the latest round of discussions.  The official, who spoke to reporters on condition of anonymity, called the negotiations "a complex process" and said Kerry was "committed to doing anything he can" to help.

An EU spokesman said French Foreign Minister Laurent Fabius will join Kerry at the talks "to help narrow differences in negotiations" -- a last-minute decision that suggests a deal could be imminent, Reuters reported. Even if an agreement is reached, it would only be the start of a long process to reduce Iran's potential nuclear threat, with no guarantee of ultimate success. Netanyahu said Friday that he "utterly rejects" the emerging nuclear deal between western powers and Iran, calling it a "bad deal" and promised that Israel will do everything it needs to do to defend itself.   "I understand the Iranians are walking around very satisfied in Geneva as well they should because they got everything and paid nothing," Netanyahu told reporters before meeting with Kerry in Tel Aviv.

"They wanted relief of sanctions after years of grueling sanctions, they got that. They paid nothing because they are not reducing in any way their nuclear enrichment capability. So Iran got the deal of the century and the international community got a bad deal," Netanyahu said. "This is a very bad deal and Israel utterly rejects it. Israel is not obliged by this agreement and Israel will do everything it needs to do to defend itself and defend the security of its people," he said.

Israel believes Iran is trying to develop a nuclear weapon, and says international pressure should be stepped up, not eased. Tehran's chief nuclear negotiator, Abbas Araghchi, told Iranian state TV on Thursday that the United States, Russia, China, Britain, France and Germany "clearly said that they accept the proposed framework by Iran." He later told CNN that he thinks negotiators at the table are now "ready to start drafting" an accord that outlines specific steps to be taken.

About the Author
Phil Flynn

Senior energy analyst at The PRICE Futures Group and a Fox Business Network contributor. He is one of the world's leading market analysts, providing individual investors, professional traders, and institutions with up-to-the-minute investment and risk management insight into global petroleum, gasoline, and energy markets. His precise and timely forecasts have come to be in great demand by industry and media worldwide and his impressive career goes back almost three decades, gaining attention with his market calls and energetic personality as writer of The Energy Report. You can contact Phil by phone at (888) 264-5665 or by email at pflynn@pricegroup.com. Learn even more on our website at www.pricegroup.com.

 

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