Riots in Iran raise the Middle East uncertainty

After the riots in Egypt and Tunisia have subsided and the turmoil in Libya continues, the next country in the Middle East causing the stir up in the region is Iran.  Many have thought it will only be a matter of time before there will be an outbreak in Iran:

There are reports from opposition blogs of riots in Iran as protestors are calling the release of the opposition leaders Mousavi and Karroubi from jail, after they were taken to an undisclosed location.  Iran officials claim Iran won’t release the location of Mousavi and Karroubi as it’s an internal matter. As a result, violent riots are being held in Tehran between protestors from the opposition and Military forces.

Iran, one of the founding members of OPEC, holds the third largest proven oil reserves in the world with 137.6 billion barrels of oil as of January 2010; and the second largest natural gas reserves worldwide.

Iran is also the second largest producer of oil after Saudi Arabia with 3.8 million barrels of oil per day during 2009.

If the recent riots in Iran will develop into something as the turmoil in Libya turned out to be, this could adversely affect the uncertainty in the Middle East, which is already high to begin with.  And consequentially, might affect crude oil price in the short term at least as the anxiety among oil traders level might rise.

Currently crude oil market might be reacting to this news as crude oil price is traded with moderate rises (might be, because the rises aren’t very high so it could might be just noise, if the trade will finish with huge rises, this could be more likely to be related to the recent news from Iran):

The Nymex crude oil price, short term futures (March 2011 delivery) is traded at 98.58 USD / barrel, a 1.61 USD/b rise or a 1.66%, as of 16.32 PM*.

The Dated Brent spot crude oil is at 113.38 USD / barrel – a 1.44USD/ barrel increase as of 16.43 PM.*

(* GMT)


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2 comments for “Riots in Iran raise the Middle East uncertainty

  1. Mohammad
    March 7, 2011 at 2:08 pm

    Nobody has seen any riots in Iran recently. I guess you’ve mixed it up with Saudi or Bahrain. The countries being under riot after Tunisia and Egypt are Yemen, Bahrain and Algeria, and recently Saudi Arabia. This coming Friday will show the fate of Saudi Arabia. It ups to it’s people wether or not they listen to clerics who have banned the protest.

    • admin
      March 7, 2011 at 6:33 pm

      Hi Mohammad,

      Thanks for your comment and insight about the Middle East, it always good to read on this very interesting subject and not only from an oil market perspective.

      I posted this news item only because there were reports of protests (if you prefer over the word riots) in Iran. This news item I picked from different sources including Bloomberg. And there are some video in the Huffington post showing part of the protests.

      In any case these protests in Iran are currently not at the same scale as the Egyptian or Libyan riots are.

      I have only tried to point out that if the condition will escalate in Iran it could have a dire effect on the oil market.

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