Higher Gas Prices Could Follow Trump's Exit From The Iran Deal

Higher Gas Prices Could Follow Trump's Exit From The Iran Deal

Essentially, any nation that fights the US on this decision will be, in effect, choosing Iran over the United States and this is highly unlikely.

The diplomatic campaign for keeping the nuclear agreement in place comes a few days after Trump defied protests and last-minute lobbying by his European partners and unilaterally made a decision to withdraw from the historic nuclear accord and impose new sanctions on Tehran. In every respect, the imposition of sanctions on Iran would be a special situation, too.

Crude surged past $71 for the first time since 2014 as American stockpiles shrank and the US told crude buyers to curb purchases from Iran.

Earlier this week, President Donald Trump announced the US withdrawal from the Iran nuclear deal, which he called "defective at its core".

The administration says the lifting of sanctions as part of the nuclear pact had allowed Iran to build up its military.

Tehran agreed in 2015 to curb its uranium enrichment programme in exchange for sanctions relief after mammoth negotiations with the US, France, Germany, the United Kingdom, China and Russian Federation.

Admiral West told Daily Star Online: "If Iran has nuclear weapons, then the Saudis will want them and can probably get them from Pakistan".

Iranian President Hassan Rouhani said there was a short time to negotiate with other world powers, but if talks failed Tehran was ready to resume its nuclear work. He demanded to "fix" it, threatening to withdraw the USA from the deal.

President Trump's decision to pull out of the nuclear deal has sent shock waves rolling through this whole region - and amplified widespread public anger.

There is some chatter in the markets suggesting Kuwait and Iraq as two producers with the best ability to raise output quickly in response to any fall in Iranian exports.

Iran would rather increase exports than pressure oil prices higher.

Oil-rich Saudi Arabia has long said it would match any Iranian weapons development, but Jubeir's renewed vow came after US President Donald Trump pulled the United States out of an accord created to prevent Tehran's alleged quest for the bomb. This would essentially end the OPEC-led deal to trim production. Our model suggests that roughly 25% of Iranian oil exports will be curtailed over the course of a year, but far less over the next 180 days, which is the window provided by the US Treasury to comply with the sanctions.

Iran, which is one of the world's largest oil producers, started pumping out another 1 million barrels of oil per day when economic sanctions were lifted in 2016. Reuters news agency says Shell and some other European firms with big operations in the United States prefer to push for U.S. waivers on a case-by-case basis.

European oil refiners and trading houses began preparing to cut purchases of Iranian crude.

The price action suggests that if the US follows through on the sanctions against Iran, no one, including Europe and China, is going to oppose the move.

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