Tags: Iran | Oil | Ban | EU | europe

Iran Oil Ban by EU May Send Brent Crude to $125, SocGen Says

Wednesday, 04 Jan 2012 01:28 PM

 

Share:
  Comment  |
   Contact Us  |
  Print  
|  A   A  
  Copy Shortlink
Brent crude futures, trading near $113 a barrel today, may rally to $125 should the European Union ban imports of Iranian oil, according to Societe Generale SA.

Such a move would require about 600,000 barrels a day of replacement supply from Saudi Arabia, depleting the country’s spare capacity, said Mike Wittner, the bank’s head of oil market research for the Americas. Iran would struggle to find alternative buyers for the banned crude, he said.

European Union governments moved closer to halting oil purchases from Iran, stepping up the confrontation over the Islamic republic’s nuclear program. EU foreign ministers plan to announce harsher sanctions on Iran’s energy and banking industries at their next meeting on Jan. 30 after Greece lifted its objections to an oil embargo.

“The EU imports 600,000 barrels a day from Iran, that will go to zero sooner or later,” Wittner said today in a phone interview from New York. “Does Saudi have the ability to replace it? Yes. But then the market may become concerned about how much spare capacity Saudi Arabia has remaining.”

While Iran will probably divert some of the unsold crude to Asia, the country would be unlikely to sell all of it there, Wittner said. Refiners would find it difficult to cut their intake of Saudi Arabian crude in order to take extra Iranian cargoes, because of contractual terms with the kingdom, he said.

“China could take a little bit more,” Wittner said. “If Iran has 600,000 barrels a day looking for a home, I don’t think it would be easy to sell it elsewhere.”


© Copyright 2014 Bloomberg News. All rights reserved.

Share:
  Comment  |
   Contact Us  |
  Print  
  Copy Shortlink
Around the Web
Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Country
Zip Code:
Privacy: We never share your email.
 
Hot Topics
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
Top Stories
You May Also Like

Newt Gingrich: Obama Could Learn From Bill Clinton's Cooperation

Sunday, 23 Nov 2014 18:00 PM

President Barack Obama's inability to work with the opposition is in stark contrast to President Bill Clinton, says form . . .

Graham: 'Shame On Us as Republicans' For Not Solving Immigration

Sunday, 23 Nov 2014 11:47 AM

South Carolina Republican Sen. Lindsey Graham said Sunday he is disappointed with House Republicans for not generating a . . .

Cory Gardner, Colorado May Provide Solution for GOP on Immigration

Sunday, 23 Nov 2014 07:28 AM

Republicans in search of a way to oppose President Barack Obama's moves on immigration without alienating the nation's f . . .

Most Commented

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

 
NEWSMAX.COM
America's News Page
©  Newsmax Media, Inc.
All Rights Reserved