Sub Categories: » HOMEPAGE / OPINION/ EMRE DELİVELİ
Tuesday, September 13 2011 , Your time is 15:58:00
The price of Brent Crude, the benchmark based on North Sea oil, fell $ 35 between April and June, but increases since then have taken about $ 25 of that back. According to many, reports that Israel will bomb Iran’s nuclear facilities are behind this surge. But do markets believe that this event is now more likely to occur?
Regional supply shortages have been balanced by more production elsewhere. While there are maintenance-related cuts in the North Sea, the U.S. has increased output. As a result, the wedge between Brent and West Texas Intermediate, the other benchmark, has grown. Iraq has stepped in to fill the shortfall crated by Iran, and Saudi Arabia has been pumping record amounts. Overall, production fell about 1 million barrels per day in June and did not recover in July, but this cannot account for the entire jump in the oil price.
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