Potential conflict may boost oil

Open demo account
FOREX trading implies serious risk and can result in the loss of your invested capital

Financial and commodity markets analytics

It’s not long until November before the sanctions against Iran take effect which is likely to cause a significant spike in the oil price but it seems as if Iran is not going to take the news lying down as noted in their latest round of threats.

The country believes that if they are unable to export oil from the Persian Gulf, nobody should be able to and have threatened to block the straight which some say could cause a military confrontation with the US

,"We can ensure the security of the Persian Gulf. Said General Alireza Tangsiri, of the navy of Iran's Revolutionary Guards

"There is no need for the presence of aliens like the United States and the countries whose home is not in here. All the carriers and military and non-military ships will be controlled and there is full supervision over the Persian Gulf”. He added.

The upcoming sanctions against Iran are already starting to have a significant affect according to one analyst and even though the European Union is trying to find a way to salvage the Iranian deal, the reality is that some EU countries are already making moves in order to comply with the sanctions.

It still remains to be seen whether China and India toe the line and jump on board which will really hit the Iranian economy.

“Iran remains the largest risk factor on the supply side of the market, with declines expected to accelerate ahead of US oil sanctions in early November.” Said Robbie Fraser, commodity analyst at Schneider Electric.

 “The practical reality of the U.S. sanctions threat has already forced several European buyers to curtail purchases of Iranian crude. In determining the extent of likely production losses from Iran, the key factors continue to be the extent to which China and India are willing to cut imports despite the threat of U.S. secondary sanctions.”

The material published in on this page is produced by the FIBO group companies, and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC; furthermore it has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.


The world of trading has no boundaries

IMPORTANT: Please be informed, that our services are available for Professional Clients only. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.