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Showing posts from April 18, 2021

Oil Price: strong Euro zone economic recovery and Weaker dollar push the price up

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  Oil prices did not fall precipitously as expected due to the surge of Coronavirus infections in India and Japan, the world’s third and fourth largest consumers respectively. Of course, the situation in India is very grim in terms of the exponential increase in the number of infections, relatively high death rate and the logistical problems, when it comes to disposing of bodies; the existing, centuries-old traditions and intricate taboos do not make the challenge any easier either. Japan, which is very keen on hosting the Olympics, is in a similar situation; it, however, has resources at its disposal to mitigate the severity of many challenges. In this context, it goes without saying that the demand of crude oil from both countries is going to go down in the coming weeks and in anticipation, the crude oil futures will suffer to some extent. This week, however, the oil price did not fall as much has the traders feared. On the contrary, it got back to the ‘green zone’, having be

Oil Price: two key meetings soon that affect the crude oil markets

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  Two key meetings are going to take place next week that will be crucial to crude oil markets in the long run. In Vienna, the Austrian capital, the meeting of the signatories of the JCPOA – Joint Comprehensive Plan of Action – also known as 2015 Iranian nuclear deal will resume next week. Having started the discussions recently on the subject, the delegates were back in their respective countries for consultations. They will be back in Vienna next week at a time, when the onset of gloomy outcome is on the wane. Although Iran stubbornly refuses to meet the US delegation, it still wants the US to lift the crippling sanctions; according to some reports, Iran wants 1600 sanctions to be lifted – all at once. When President Trump was in power, he used to impose sanctions on Iranian institutions, individuals and even the Supreme Leader, Ayatollah Ali Khamenei, on regular basis as if he was turning   a screwdriver clockwise; not many people did know that they were tantamount to 1600 i

Grim Pandemic Statistics in India and Japan Worry the Crude Oil Markets

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  The rising Covid-19 infections – and deaths – in both India and Japan have dampened the positive sentiment that we saw at the beginning of the week in crude oil markets. The fall in crude oil price for the third successive day clearly reflects the anxieties felt by the investors over the state of affairs in the world’s third and fourth largest users of the commodity in the face of the latest challenge. In India, the latest data as well as the ground realities paint a grim picture: the supply of oxygen has been a critical issue that is vital to saving lives; migrant workers from relatively poor states are on the move back to their villages in large numbers, which creates its own logistical challenge; crematoriums are full and in some parts of the country funeral pyres are lit in the open. Having anticipated the catastrophic impact on the economy that just showed some improvement, the states are reluctant to go into full lockdown; they know all too well how difficult it is to rev

Iranian 2015 Nuclear Deal: Iran wants 1600 sanctions lifted - all at once!

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The discussions between Iran and the signatories to the JCPOA, Joint Comprehensive Plan of Action, also known as 2015 nuclear deal, continue in Vienna, the Austrian capital. Although there was some speculation of a breakthrough last week, a new impasse appears to have emerged, according to Iranian news media. Last week, Seyed Abbas Araghchi,Iran’s Deputy Foreign Minister, hailed the ongoing discussions as ‘serious interactions’. This week, however, Iran has hardened its position somewhat: it wants ‘other side’ do display what it called the ‘political will and seriousness’; it even issued a warning, ‘Otherwise, there will be no reason to continue negotiations.’ During President Trump’s term, the US had slapped Iran with 1600 sanctions, a staggering number in a period of little over two years. Iran has demanded that 1600 sanctions should be lifted all at once, subjected to ‘verification’ by Iran and its closest allies. Iran says that the Islamic Republic should be able to sign

Oil Price: recovery in a year since the Great Oil Crash

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  It has been a year since textbooks on fossil fuels were revised, adding an indelible bookmark to the contents that span decades; the crude oil price crashed on April 20, 2021 with price going to negative for the first time ever – something that has never happened in the history of oil trading. Nor was it predicted by any analyst, even in the worst case scenario. It was, quite rightly, branded, the Great Oil Crash. Not only did the oil price recover quickly from the disaster, but also steadily increased while defying a catalogue of uncertainties, ranging from resurgence of Covid-19 infections to political tension in the Middle East that sometimes bordered on military conflicts. This week, the price picked up again amidst the weaker US dollar. In addition, the markets are in a buoyant mood due to the rise in China’s petroleum imports and the fall of US crude oil stocks. The news that comes from the world’s first two consumers of the crude oil clearly shows that recovery of de

Oil price dips: concerns about Coronavirus infections in Asia worry markets

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  The crude oil price fell on Monday despite the emergence of multiple factors to the contrary. The strong growth figures in the US and China,   the two top global consumers of crude oil were in favour of a rise in demand: China’s crude oil imports rose in direct proportion; in the US, meanwhile, the crude oil stockpiles dropped considerably in the past week, according to the latest figures from the EIA, US Energy Administration. The ongoing discussions involving Iran and the signatories to the 2015 nuclear deal provided the Middle East with some form of hope for stability; the positive sentiment outweighed the impact on the supply side of the oil equation with the arrival of Iranian oil into the crude oil markets. Not only did these factors help oil markets minimize the damaging fluctuations, but also to get the price up to a sustainable level. This week, however, price may see a slight downward trend due to Coronavirus concerns: in Asia it paints a grim picture; India, the wo

Reviving the 2015 Iran Nuclear Deal: Iran and negotiators are upbeat about a breakthrough

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  There are positive signs emerging from the current meetings between Iran and the signatories to the 2015 nuclear deal that take place in Vienna, the Austrian capital. According to the media reports, the delegates from the United Kingdom, Russia, Iran, Germany, France and China are continuing with the negotiations, while reporting the progress made to their US counterparts, staying in a different hotel in the Austrian capital. Iran’s top negotiator seems to be upbeat about the progress made so far; he declared that ‘new understanding’ emerges from the talks that they held so far – involving all sides. Having moved the goal posts a few times, Iran and the signatories of the 2015 nuclear deal have come a long way, slowly easing their stubborn stance with time; Iran is leading on this front – softening its position. Despite the good news that comes from Vienna, some regional obstacles still remain: for instance, Iran, mainly Shia, Persian nation, already accused the GCC, Gulf Cor

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