Crude has rallied 6 straight sessions, it’s longest winning streak in 13 months. We’re again staring at $100 a barrel.
The rhetoric has grown more heated out of Iran in recent weeks which has sent jitters through the oil market.
Iran is currently in the middle of a 10-day war games exercise in the Arabian Sea and the Gulf of Oman. But today, the official news arm of Iran’s government, the Islamic Republic News Agency, quoted Vice President Mohammad Reza Rahimi as threatening to bar shipments through the Strait of Hormuz, where a third of all oil transports travel, if sanctions are imposed on Iran’s oil exports.
In early 2012, the EU is expected to debate a boycott of Iranian oil which could tighten the noose further.
Iran is overshadowing other energy developments. Oil traders have overlooked the recent good production news out of both Iraq and Libya.
Iraq’s oil production jumped to just over 3 million barrels a day, the highest in 20 years, and is expected to rise to 3.4 million barrels a day by the end of 2012. Libya is back to producing a million barrels a day, much of which was interrupted by the uprisings this year.
With Iran rattling its saber, is an oil shock coming in early 2012?
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