Want to know how high oil can go? So do the oil markets, frankly.
West Texas Intermediate closed today at $72.32 a barrel, up another 2.54%. The U.S. crude benchmark stood at $64.19 on June 15. That’s a gain of 12.7%.
Lurking in the wings is a demand by the Trump administration that all countries cut oil imports from Iran to zero by November 4 or face sanctions as the U.S. puts restrictions on Iranian oil exports back in place after the United States pulled out of the Iran nuclear deal.
A U.S. delegation is set to visit the Middle East next week to urge producers in that region to ensure adequate global oil supplies when Iran is cut out of the market on November 4. Buyers of Iranian oil had expected that the Trump administration would allow them more time to reduce their imports from Iran. Iran exports 2.5 million barrels a day–which presents a huge challenge to OPEC and other producers who just raised production by 700,000 million barrels a day in order to push global oil prices lower.
A senior State Department official said yesterday said the administration doesn’t plan to issue any waivers, and would instead be asking other Middle Eastern crude exporters over the coming days to ensure oil supply to global markets. Iranian oil officials have called the goal of removing Iranian oil from the global market by November “impossible.”