The comments today from Rubio and Rezaei don’t sound like there is any possibility of a deal. So it looks like it’s back to some kind of war of economic attrition, with the US attempting to blockade Iran while Iran tries to drive the price of oil higher with the help of Houthis in Yemen.
How that goes depends on how effective you think Iran will be in disrupting shipping in Hormuz. Today, France’s Macron was out with talk about improving insurance rates in Hormuz. It’s also not clear how much oil is getting out of the gulf via alternative routes, not to mention oil products and other commodities.
At the same time, I’m not sure how much weight you can put on public comments from Rezaei, Rubio or anyone involved.
From Rezaei:
- Strait of Hormuz will not be opened until US meet’s Iran’s seven conditions
- All US claims regarding continuation of negotiations with Iran are pure lies and fabrications
- We asked the US to provide a clear response to our proposals
- US hasn’t provided a clear response yet but they might provide such a response in the future
What makes me most skeptical about his credibility are his denial of negotiations. There have been so many reports of planes flying between Iran and elsewhere, that’s a laughable line.
WTI is down 22-cents to $86.70 but the momentum in talks is clearly lost and I see clear upside risks from here.
Rezaei is the secretary of Iran’s Supreme National Security Council.
This article was written by Adam Button at investinglive.com.