Oil traders don’t want to think about the worst-case scenario and lap up every word of U.S. President Donald Trump about a potential deal with Iran, but the market needs to brace for a spike in oil prices in July because four months of closed Strait of Hormuz is a recipe for a \u201cdisaster\u201d and global recession.<\/p>\n
These were the comments from Fereidun Fesharaki, Chairman Emeritus of energy consultancy FGE NexantECA, who told CNBC<\/a> early on Monday that the oil market and the equity markets are at a stage where \u201cany news is good news\u201d regarding the possibility of a U.S.-Iran deal.<\/p>\n \u201cNobody wants to think about the worst-case scenario. So everybody thinks every news is good news,\u201d Fesharaki told the CNBC Access Middle East program.<\/p>\n Set OilPrice.com as a preferred source in Google here<\/a>.<\/p>\n \u201cThey really think this is a change. There is no change. We are not nearer a peace agreement than we were several weeks ago,\u201d the oil market expert said, commenting on the latest signals from Washington<\/a> that a peace agreement could be imminent.<\/p>\n The deal itself would aim to reopen the Strait of Hormuz, end the war, and see Iran give up its enriched uranium. The first stage of the agreement would be a 60-day extension of the ceasefire, during which time traffic would resume through the Strait, and nuclear negotiations would continue.<\/p>\n Yet, FGE NexantECA\u2019s Fesharaki warned against too much optimism in markets and advised traders to look at the actual shortage of crude and products that are not getting out of the Strait of Hormuz.<\/p>\n Amid this shortage on the physical market, \u201csooner or later we get to the trigger point,\u201d Fesharaki said.<\/p>\n At some point in July, the oil market will get to this trigger point \u201cwhere the prices will go for a huge jump,\u201d the expert told CNBC.<\/p>\n The wishful thinking that we\u2019ll get over this or somehow President Trump could negotiate a deal is just traders misreading the market, Fesharaki noted.<\/p>\n By Tsvetana Paraskova for Oilprice.com<\/a><\/p>\n More Top Reads From Oilprice.com<\/p>\n","protected":false},"excerpt":{"rendered":"Oil traders don’t want to think about the worst-case scenario and lap up every word of U.S. President…\n","protected":false},"author":2,"featured_media":664334,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[27],"tags":[28,3331,290459,247045,247044,801,214052,290458,4011,210369,290460],"class_list":["post-664333","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-business","tag-cnbc","tag-crude-oil-spike","tag-fereidun-fesharaki","tag-fge-nexanteca","tag-iran","tag-iran-deal","tag-oil-market-outlook","tag-oil-prices","tag-strait-of-hormuz","tag-u-s-iran-negotiations"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/664333","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=664333"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/664333\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/664334"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=664333"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=664333"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=664333"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}