|News||Crude oil is volatile after yesterday's gains|
|Analysis||Crude oil is so volatile today amid mixed factors, where the EU’s decision to ban the Iranian oil exports in the middle of this year helped in pushing crude to the upside despite negative factors that is weighing on crude such as the disagreement between Greece and its private bondholders.|
Crude oil opened today’s session at $99.85 and recorded a high of $100.16 and a low of $99.44, where it is currently trading around $99.61 a barrel.
The effect from the EU embargo which urged by US to ban the Iranian oil production has pushed oil prices higher amid fears that global oil supplies will be enough or not and whether it will meet demands or not, where the EU decision came yesterday after the foreign ministers’ meeting, where current contracts will continue until the end of June.
After June, no contracts between EU members and Iran will be valid, and not just that, as the ministers’ decided also that the union will freeze all assets from the Iranian Central Bank and not to trade gold or other precious metals with the bank.
Despite the decision of EU’s ministers has been delayed until the end of June, but it had a major effect on crude prices, as countries will strongly demand oil nowadays to prevent any shortage of oil supplies in the coming period and to ensure having all their needs of oil.
The effect from EU embargo was strong enough to push crude around $100, despite the euro finance minister disagreement with the Greece’s bondholders that offered to take 50% haircuts on their owned Greek bonds and four percent interest on new bonds, which put the Greek future on the edge, yet the Euro future is not clear so far if Greece defaults.
Volatility may be so high today ahead of EU’s finance ministers’ meeting, which might find an agreement with the private sector that holds the Greek bonds, which will ease fears over the Greece’s outlook.
Amid all these factors, the common currency (Euro) has kept its high levels yesterday and rose today despite the Euro finance ministers’ disagreement, which added negative pressures on the US dollar and pushed it to the downside.
As the USDIX opened today’s session at 79.80 and recorded a high of 79.92 and a low of 79.70 and it is currently trading around the opening level, after it yesterday opened at 80.37 and closed the session at 79.79.
On the other hand, some countries are shifting to depend on itself and reduce its oil imports such as the United States, as the EIA said that the country’s new ambitions to grow its shale oil production will raise U.S. domestic crude output by a fifth over the next decade, helping to slash the country's dependence on foreign oil imports.