Global investment banker Goldman Sachs has projected that with the US withdrawal from the Iran nuclear deal, oil price would rise by about $6.20 per barrel.
Global investment banker Goldman Sachs has projected that with the US withdrawal from the Iran nuclear deal, oil price would rise by about $6.20 per barrel. International oil prices are at risk seeing a steep rise after the US President Donald Trump’s decision to withdraw from the 2015 Iran nuclear agreement, coupled with rising tensions in other oil-producing countries such as Saudi Arabia and Venezuela, Goldman Sachs said on Wednesday
“Such elevated oil geopolitical risks exacerbate the upside risks to Brent forecasts and reinforce our view that oil price volatility will continue to increase,” Goldman Sachs said in a note. Oil prices on Thursday clocked up more multi-year highs as traders adjusted to the prospects of renewed US sanctions against major crude exporter Iran.
The oil supply is already tight as OPEC members and non-members led by Russia are cutting their productions to boost the price. Brent crude futures, the international benchmark for oil prices, hit their strongest since November 2014 at $77.76 per barrel on Thursday. US West Texas Intermediate (WTI) crude futures also marked a November-2014 high, at $71.75 a barrel.
The Trump administration’s decision to walk away from the Iranian nuclear deal has opened up the risk of sanctions, regional military conflict, and attempts at regime change. “Europe and China will not fight against the US sanctions. They will grumble and accept it. There is no one who will realistically choose Iran over the US,” energy consultancy FGE told Reuters.