You can see it now for several days in media reports. There are street protests against the Iranian government due to the economic situation in the country, which does not seem to be so rosy for so many people – despite abolished sanctions and oil wealth in the country. There have already been numerous deaths regardint the protests. And today, there should be a nationwide general strike.
That would also mean that oil production could go down massively. As we said, this could happen! It is still unclear how extensive the protests are in these minutes. But Iran is the heavyweight in OPEC alongside Saudi Arabia and Iraq. If Iran gets problems with its oil production due to its civil unrest, it will reduce the supply of oil worldwide. Of course that’s good news for all oil bulls.
So up with the price of oil! The American WTI Oil price is currently quoted at $ 60.31 (earlier today at $ 60.71). In the chart, we noted the upward push from December 26, when an oil pipeline exploded in Libya. The Oil price went up massively. Allegedly, the pipeline problem in Libya should be fixed now, so that the oil can flow towards the coast. However, there is no sign of a falling oil price that compensates for the 26 December decline.
Well, thanks to God, may one say to himself as oil bull – just in time, Iran has emerged as a new reason to buy Oil Contracts with the protests and the alleged general strike today as reason. Of course, this strike would affect the supply much more than a broken oil pipeline in Libya. But the chart clearly shows it. The oil market currently wants to go up. The arguments for this upswing are found after the upswing – it seems like this! (this is of course no guarantee for further rising prices).
From a fundamental point of view, one can also remember the words of the Saudi oil minister from November 30th in Vienna. There, in response to the question regarding US Frackers, he said that they would promote more and more. But the demand side continues to grow from year to year (quote), much more so than the frackers could raise their output. Therefore, he was quite relaxed that enough market shares are left for all producers. Is the market currently floating up on this “wave of knowledge”?