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The West/Israel preparing for air stikes against Iran? (update 1)

Posted by Adrian on August 1, 2008

As oil hovers around 121-124 a barrel. The latest US GDP came in at 1.9% lower than apparent estimates of 2.3%, but the US is probably slowing more rapidly than that, with the finance industry contracted significantly and general industry in the US laying of staff or planning to retrench. The housing market also continues to slide downward.

Oil should be decreasing more so than the current price. If support is set at 120 (by some oil analysts), the substantial selling point could be below 120. This hasn’t happened yet. Although oil has dropped significantly from all time highs of 147 a barrel. The correction to 110, 100, 90 would be a good indicator of the recessionary sate of the US economy, however the lack of further declines of the oil price (below 120 range) could be attributed by the demand of China and other emerging economies such as India.

Other factors that are contributing the trading price of oil at 120 and 125 is the possibility of a military strike against Iran – that could be as early as August 2008. Or at some point before or after Olmets departure as Israeli PM.

But warning signals are now presenting themselves, more notably Norway’s oil company StatoilHydro

pulling out all investment and development plans from Iran, supposedly under the auspiciousness of US wishes. But with money involved and with oil where it currently stands (expensive). I find it unlikely that a company would have some political reason to cancel it’s contracts, unless there was a fear that it’s assets and share price could be effected by a military strike, from FT.com

the Norwegian national oil company, has become the latest big western energy group to commit not to invest in Iran, following pressure from the US.

Statoil, which is 62.9 per cent owned by the Norwegian government, had been evaluating a big oil development in Iran but will announce on Friday that it “will not make any new investments in Iran at this time”.

Oil analysis and graphs will be posted soon.

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One Response to “The West/Israel preparing for air stikes against Iran? (update 1)”

  1. […] could be that support of 120 is keeping the oil price from falling any lower. Please refer to previous post in regards to oil price support of […]

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