Crude oil prices move higher in Tokyo

Clay Curtis
September 17, 2019

"Today's press conference is going to be crucial - we have to wait for that really", said Olivier Jakob, managing director at consultant Petromatrix GmbH in Zug, Switzerland.

He said the USA was still investigating if Iran was behind the attacks, but added that "it's certainly looking that way at this moment".

"We don't need Middle Eastern Oil & Gas, & in fact have very few tankers there, but will help our Allies!"

In response to drone attacks on a Saudi Arabian oil processing plant, President Trump said the United States is "locked and loaded".

If the tensions grew to the point when the Strait of Hormuz were actually shut, then the oil prices could rise to $100 a barrel. After skyrocketing nearly 20 percent in early trading, crude oil still settled higher at just under 14 percent for now. Market analyst David Madden of CMC markets argues that such a surge "is highly unlikely", but still expects oil futures to trade higher.

American involvement in a Saudi-Iran war would do little to protect the national security or economic interests of Americans. Borenstein also says though the Saudis say they can fix the damage soon, it's too early to tell. Iran denied the accusations that it was behind the attack. Saudi Aramco didn't immediately respond to an email seeking comment. Speaking to students, he said that was the reason why Rouhani, Foreign Minister Mohammad Javad Zarif and other officials "unanimously declared we won't negotiate with U.S. bilaterally or multilaterally".

Saudi Arabia is calling on the global community "to shoulder its responsibility in condemning the perpetrators" and "clearly confronting" those behind an attack on the country's oil facilities over the weekend.

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MRPL also gets oil from countries like Kuwait, Abu Dhabi and Iraq in addition to Saudi Arabia. At that time, Iran claimed the drone had entered its airspace, while the US claimed it had not. Earlier estimates had suggested it could take weeks.

For months, Iranian officials have issued veiled threats, saying that if Tehran is blocked from exporting oil, other countries will not be able to do so either.

Since then, heavy sanctions have been placed on Iran by the U.S. in an attempt to pressure Rouhani into submission.

The oil infrastructure attacks appear to have dashed any hopes of detente between the two nations, scuppering President Emmanuel Macron's efforts to facilitate a meeting between Trump and Iranian President Hassan Rouhani at the upcoming United Nations General Assembly. He has said even if the sanctions are lifted, any talks must be held in the framework of the nuclear accord.

"Certainly, it would look to most like it was Iran".

The cuts mean there will be 5.7 million less barrels of crude oil produced every day and this represents more than five percent of global daily production. Rouhani said the attacks were an act of self-defence by the Huthis against the Saudi-led forces conducting an air campaign against them since 2015.

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