Oil Is Tumbling

[FarCenter]

Brent crude futures fell as much as $2.50, about 2%, to $108.63 as Monday commodities traders digested the interim deal reached this weekend to curb Iran's nuclear activities.

Analysts were predicting this kind of significant but not overwhelming market reaction. Western powers agreed they would begin lifting the ban on Iranian exports to their countries in six month's time. But Iran's oil sector has been hit hard by sanctions, and it may take some time for production to recover to pre-2010 levels. As Bloomberg reported:

"The agreement probably will have a 'somewhat muted' effect on oil prices, according to analysts including Mark Keenan, cross-commodity research strategist at Societe Generale in Singapore. 'We can, however, expect some price weakness as the market adjusts to the future prospect that Iranian exports will resume,' he said by e-mail."

Read more: http://www.businessinsider.com/brent-crude-and-iran-deal-2013-11

[roamer65]

1. Looks like the Chinese will have what they want soon.

Iranian oil.

[Sen. Walter Sobchak]

7. China imports 5-6 million barrels of Iranian crude per year

[FarCenter]

11. More than 400,000 barrels per day

China imported 475,521 barrels per day (bpd) of Iranian crude oil last month, registering a 24-percent rise in comparison with the corresponding period last year, Reuters reported on Monday.

The figure was also nine percent higher than August’s 436,300 bpd level.

China, Iran's largest oil client, for the nine months through September bought 16.01 million tons of Iranian crude oil, or an average of 428,160 bpd.

http://www.presstv.com/detail/2013/10/21/330604/china-ramps-up-iran-oil-imports-in-sep/

[Sen. Walter Sobchak]

12. You're right… jetlag brain.

[mwrguy]

2. 2% is tumbling?

Hmm

[bhikkhu]

3. Pre-2010 was still pretty volatile, and covers both higher and lower ranges

If someone were going to be an optimist, they might say pre-9/11 ranges, the last time it was reasonably stable. The price then was about $30 a barrel then.

But...oil production has fundamentally changed since then, and high costs are pretty much built into current production. A price below $80 would make a lot of fields unprofitable, and would take a bunch of oil off the market if it were sustained. Demand would then drive the price back up.

So - the "somewhat muted" effect is most likely. Stabilizing around $90-100 a barrel would be the best thing for the markets.

[Sen. Walter Sobchak]

8. The folks I work with see $70 as the bottom line where US production is still unaffected

The capital flight will be from Canadian unconventional projects.

[Spider Jerusalem]

13. Demand would have to fall to pre-9/11 levels

or really, below them, considering that conventional crude production peaked c. 2004 and all the new production is in tar sands/shale/deepwater.

[Rstrstx]

4. Then why has gas gone up 20-25 cents here?

Time for a good ole' holiday porking by the oil companies?

[Lugnut]

5. That's what I'd like to know.

It shot up 14 cents in two days and is now at $3.399.

[uponit7771]

6. We're exporting gasoline at record rates again, keeping prices in US high

... gas prices should NOT be as high as they are seeing that the EIA.gov is reporting that we're using less gas now than when we did in the mid 80s.

Commodity trading and exporting gasoline and big oil shutting down refineries...

Thx to Obama and the MPG standards we're using less gas in our cars but there's little they can do about the collusion among the oil companies

[malaise]

9. Yes this should fugg up those who get rich gambling

on human misery.

[Fumesucker]

10. Yay! Now I'm gonna go out and buy that 6x6 F350 V10 crew cab duallie for commuting

[bobGandolf]

14. Don't worry, they'll think of something....

to change that very soon. Might make it till Xmas, before prices rise again, but not much longer.