Posted On 14 Jan 2014
The barrel of “light sweet crude” (WTI) to be delivered in February fell 92 cents to 91,80 dollars on the New York Mercantile Exchange (Nymex), due to the rise of the global crude oil supply after the new advances in the dialogue on Iran’s nuclear program.
In London, the barrel of Brent from the North Sea to be delivered in February fell to 106,75 dollars on the Intercontinental Exchange (ICE), a drop of 50 cents compared to the closing on Friday.
Iran and the United States announced that on January 20 will take effect the agreement between Tehran and the Group 5 + 1 (China, United States, France, Britain, Russia and Germany), which stipulates that Tehran agrees to freeze its nuclear activities for six months in exchange of more flexibility over international sanctions.
“Unless oil production is reduced elsewhere, this will lead to a surplus of considerable supply on the market, which will affect the prices”, economists at Commerzbank explained. Openness to the Iranian “black gold” is not yet underway, “but investors anticipate the fact that this crude eventually will reach the market,” which will affect the prices in London and New York, said John Kilduff of Again Capital.
“Some buyers are particularly eager to resume imports,” such as China and Japan.