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.*
For more on this subject:
- Oil prices outlook – 28 February
- Oil prices soared as Libyan riots continued – Weekly recap 21-25 February
- Oil prices outlook – 24 February
- Weekly outlook for Crude oil, Natural gas and Gold 28 Feb – 4 Mar