|News||Crude oil fluctuates ahead of EU foreign ministers' meeting|
|Analysis||Crude oil fluctuates heavily at the beginning of the week ahead of the EU’s foreign ministers’ meeting which will take place today and would discuss the sanctions on Iran, including banning Iranian oil exports, but it may take several months until it take effect, also, the Finance ministers’ will meet today and is expected to finalize the Greek second bailout’s requirements and terms.|
Crude oil depends today on the European continent since no major data is due today, and the importance of these meetings for crude oil, as it will direct oil to wherever they want, but the most important factor today for crude is the decision of foreign ministers.
Crude oil opened today’s session at $98.32 and reached a high of $98.33 and a low of $97.43, where it is currently fluctuates around $98.05 levels.
After crude declined below the physiological level at $100, crude is so volatile and fluctuates heavily, where different factors are now affecting the outlook for curde; however, the ministers today are expected to take the decision of banning Iran’s oil exports, but a delay may happen to several months due to debt-laden nations’ reliance on Iranian oil, such as Greece, Italy and Spain.
It is widely expected that ministers will take a decision today but is expected to be phased in; the six months grace period is expected to deprive oil from any sudden impact today yet any change in that or strong comments from Iran on the decision will again support the upside rally. If the ministers announce new hard measures, crude will soar due to fears of oil supplies.
Also, the EU measures are not exclusive on just oil, as it will likely hit the Iranian central bank and not to trade gold with the Iranian government, which will raise the tensions between the west and Iran, the EU is expected to follow their US colleagues and decide the EU embargo on Iran’s oil exports.
Nonetheless, OPEC’s president prefered not to intervene in the West-Iran battle on the Iranian nuclear program, which led to the sanctions imposed on the Iranian oil exports, and a threat to close the Strait of Hormuz, according to Iran’s IRNA news agency.
On the other hand, the Euro zone Finance ministers will meet today, which is considered as a key factor behind crude’s trend but not as strong as the foreign ministers’ effect, where they will discuss the Greek situation and the development with the restructuring plan and measures.
Greece will share what the discussions led to with private bondholder, the finance ministers will discuss also the Greek plan and how things will go on in the European summit which will take place at the end of this month, also, Ministers will discuss the European permanent bailout fund.
All in all, volatility will be so high today ahead of EU decision on Iran’s oil, and any surprise will be reflected immediately on crude trading, where the finance ministers’ meeting is important as well which will show us the route that Greece will move in.