Oil Caught Between Iranian Shortfall and OPEC Ramp Up

October 4, 2018 Share Print 0

Oil held near four-year highs on Thursday, supported by the imminent loss of Iranian supply through U.S. sanctions, but also tempered by the prospect of a rapid production boost from Saudi Arabia and Russia.

Brent crude oil futures LCOc1 were down 19 cents at $86.10 a barrel by 1133 GMT, having risen to a late 2014 high of $86.74 the day before. U.S. crude futures CLc1 fell 17 cents on the day to $76.24.

“Prices will probably rise further into overshoot territory. Once we see $90 I would expect decisive supply reaction,” Commerzbank strategist Carsten Fritsch told the Reuters Global Oil Forum.

“Major economies won’t let oil prices rise to triple digits and harm economic growth.”

Nitin Gadkari, India’s transport minister, said his country faced “economic crisis” due to its huge oil imports, two local TV channels reported.

via Reuters

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Alfonso Esparza

Senior Currency Analyst at Market Pulse

Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.