“Sharp Fluctuation in Oil Prices due to Sanctions”
Polnymus, chief executive of the BP oil giant, told the CNBC network that ambiguity surrounding Iran’s oil industry, ahead of US sanctions, could trigger a sharp fluctuation in oil prices.
Bob Dudley said in interviews with the CNBC network: “I think 45 days of intense fluctuation may continue, oil prices may rise or it may be negative or positive.
Dudley’s remarks came at a time when oil market players were watching closely what would happen after the United States imposed sanctions on Iran’s oil industry on Nov. 4.
It is very difficult to estimate exactly how much Iranian oil production will be affected by US sanctions, depending on whether Iran’s oil customers are afraid of having a second-round US sanctions because of trade ties with Iran. . The French company Total, a rival to BP, officially announced the departure of Iran’s South Pars Oil and Gas Project in August.
But BP and the company Searly Energy on Tuesday received a new license from the United States to operate a North Sea field in which Iran contributed. Extension of the exemption for US-led operations showed that there could still be exemptions from oil sanctions.
Dudley said that if oil consuming countries receive exemptions from US sanctions, oil prices may decrease, however, there is still a lot of ambiguity.
Some analysts predict that the maximum 1.5 million barrels per day of Iranian oil exports would be affected by US sanctions, which would increase oil prices.
CEO BP does not expect demand to drop as a result of high prices, as global GDP growth is still strong. “The global economy is still growing, and demand may fall slightly, but it will not go away,” he said.
At the oil and money conference in London, Dudley said, “We are relatively distant from the good price of oil, and BP has planned $ 60- $ 65 per barrel for the price cycle.”
US President Donald Tramp has called on OPEC to increase oil production to counteract the impact of Iran’s supply drop on prices. Saudi Arabia, which is the largest OPEC member, said it has enough capacity to cover any supply shortages, but Iran has rejected such a claim. Dudley said OPEC is a better expert on technical issues but he believes Saudi Arabia has enough oil.
Acording to another latest reports, said that the prospects for global economic growth will be declining in 2018 and 2019, raising concerns about the impact of demand for petroleum products.
In the market, Brent crude oil prices dropped by 0.06 percent per barrel to $ 84 and 95 cents.
West Texas’s oil price dropped by $ 0.05 per barrel to $ 74 and $ 92.
Meanwhile, with the approach of Michigan storm to the Florida coast, nearly 40 percent of the crude oil production capacity in the Gulf of Mexico has gone from orbit. Concerned about the possible damage to the storm, many oil companies have been forced to halt and disable forces.
But in the gold market, the price per one ounce of this precious metal was up by 0.09%, at $ 1,192.
But on the market for basic metals, the aluminum price reached $ 2,400 per tonne. The London Copper also exchanged for $ 6,271 each ton. Each ton of lead was $ 1,932 per tonne and traded $ 12,895 per tonne. Tin prices also reached $ 19,10 a tonne, and each tone was traded at $ 2,688.