Rouhani at UN: Is Iran driving oil markets?
Iranian President Hassan Rouhani addresses the UN General Assembly Tuesday in speech that may have wide-ranging repercussions across the global energy sector. Rouhani's speech may be heralded as a sea change for the Islamic Republic, its nuclear work, and the oil market's reaction, Graeber writes.
Crude oil prices started the week on the decline ahead of this week's summit at the U.N. General Assembly. At center stage this week will be Iranian President Hassan Rouhani, whose Western charm offensive is a breath of fresh air in an otherwise troubled region. A weekend report suggested Rouhani's moderate stance may be enough to convince British authorities to let BP work again with Iran at a North Sea natural gas field hampered by sanctions. India, meanwhile, is eager to see how close to the sanctions envelope it can get with Iranian oil imports. Rouhani speaks Tuesday. His speech may have wide-ranging repercussions across the global energy sector.Skip to next paragraph
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Crude oil for November delivery was down Monday, on average, by more than $1 from last week on signs at least some of the tensions in the Middle East were subsiding. Past conversations regarding Iran and international oil markets typically centered on the ever-present threat to close shipping lanes through the Strait of Hormuz and the impact of international economic sanctions. This week, however, the talk is focused on the possibility of handshakes, symbolically at least, between Iran and the United States. (Related article: The Era of Cheap Gasoline is Over)
The British government is reportedly mulling sanctions that have limited production from the Rhum natural gas field in the North Sea. Sanctions in 2010 targeting Iran's energy sector suspended operations at a field that once contributed 5 percent of Britain's natural gas output. A government spokesman said it was "long-term security of the Rhum gas field" that was at stake in the decision, though BP and its joint venture partners, National Iranian Oil Co., could make millions of dollars in the restart. A weekend report said sanctions relief for Iran already helped open the spigot on the Shah Deniz natural gas field offshore Azerbaijan for European markets.