Time To Go Long Oil Again As Iran Ramps Up Uranium Enrichment

By Preetam Kaushik The recent pact between Iran and the US, along with the European Union (EU) and other western countries, is hailed as US President Barack Obama's biggest diplomatic victory. The western countries have managed to coerce Iran to agree to a deal that is seen as the once-belligerent Tehran conceding defeat in its efforts to combat the US' attempts to strangle it economically for nursing nuclear ambitions.

Reports of rising tensions between Iran and Saudi Arabia emerged over the weekend, following the execution of a prominent Shia cleric in the country. Reports also suggested that the US was postponing placing fresh sanctions on Iran, following the “highly provocative” ballistic missile test in December. Sheikh Nimr al-Nimr, a prominent Shia cleric and vocal critic of the Saudi government, was executed in Saudi Arabia over the weekend. The execution followed accusations of the Sheikh being involved in terrorist activities, and bearing arms.

With the US set to run out of on-land storage in the space of just three months and with the Iran nuclear deal still stuck in “tentative,” “maybe/maybe not,” purgatory (i.e.

Hindsight is great at identifying over-enthusiasm. Just look at the price of oil over the past few months. Its remarkable rise began in early April, after dipping below US$40 a barrel for benchmark West Texas intermediate (WTI), and continued until it peaked above US$50 through much of June. But now, with WTI once again around US$40, the blinkers are off. What were markets thinking? We look back and see the impact of the Fort McMurray fires, and the supply disruptions in Africa. How could anyone believe that was going to last?

energyspectrumindo.comThe last time crude oil prices spent significant time below $30 a barrel Ben Affleck and Jennifer Lopez were still “Bennifer,” Howard Dean was leading the Democratic primary race and Saddam Hussein had just been captured by U.S. troops in Iraq.

Paul Mortimer-Lee is the North American chief economist for the French-based global bank BNP Paribas. And like everybody else, the former Bank of England staffer, who was in Toronto on Tuesday, has oil prices on his mind. Indeed the 50% price decline over the past six months has prompted Mortimer-Lee to lower his growth forecast for Canada (by about 0.2% to 2.1%) and to raise his forecast for the U.S. (by about 0.3% to 3.3%).

Politicians and pundits from Riyadh to Washington have castigated recent American foreign policy in the Middle East for being unfocussed, misguided or harmful to national interests. Contrary to these accusations however, the Obama policy is none of the above: It is a pragmatic approach that takes into account a progressive decline in the political and economic importance of the Middle East.

WASHINGTON — The United States and Iran secretly engaged in a series of high-level, face-to-face talks over the past year, in a high-stakes diplomatic gamble by the Obama administration that paved the way for the historic deal sealed early Sunday in Geneva aimed at slowing Tehran’s nuclear program, The Associated Press has learned.