There is an ISNA report out that cites Pakistani souces and says that Pakistan remains optimistic about preserving the MOU, despite Trump yesterday saying it was “dead”.
“Islamabad and Doha are consulting on the return of Iran and the US to negotiations,” the report says.
There was also a short time ago an important communique from Iran’s Revolutionary Guard, which said “If the US terrorist army repeats its aggression, other US bases in the region will not be safe from our heavy fire.”
The key detail there is that they cited “US bases” not Gulf infrastructure. The US reportedly struck a bridge in Iran yesterday and that’s skirting a supposed red line for Iran as they said they will hit the infrastructure of US allies in the region if the US strikes its infrastructure. For now though, that looks to be off the table.
Still, there are real effects to this round of actions as Qatar said it will slow its ramp of LNG production.
Today, there market is unwinding some of the war worries with WTI crude down 79-cents to $72.72. Gold also rebounded and is up $43 to $4120.
The bigger question for the oil market is the hundreds of millions of barrels that have been lost in this conflict and the timeline to rebuild those inventories. The ability of the oil market to deal with it so far has been remarkable but much of that relied on China dropping imports by nearly 5 million barrels per day. This week, China announced that it would allow product exports from its refineries once again and that could lead to a major bid. We are also continuing to see a blowout in crack spreads and that’s going to mean that refinieries will ramp up production, and crude buying.
Given that, I like the opportunity to buy oil near $70.
This article was written by flc97fe4880a4b454993821fe0b770a597 at investinglive.com.