Oil May Rise on Tension Between Iran and the West, Survey Shows

Oil May Rise on Tension Between Iran and the West, Survey Shows

Oil may rise next week on concern
that shipments will be disrupted as tension between Iran and the
West over the country’s nuclear program increases, a bg
News survey showed.
Fifteen of 37 analysts, or 41 percent, forecast oil will
climb through Feb. 24. Twelve respondents, or 32 percent,
predicted prices will decline and 10 estimated there will be
little change. Last week, 53 percent of surveyed analysts
expected a decrease.
Iran stopped crude exports to France and the Netherlands
and threatened to end shipments to four other European
countries, state-run Mehr news agency reported Feb. 15, citing
an unidentified official at the National Iranian Oil Co. The
European Union agreed in January to halt oil purchases from Iran
as of July 1.
“Oil prices should trade higher next on the increasing
tensions surrounding Iran and its nuclear ambitions,” said John
Kilduff, a partner at Again Capital LLC, a New York-based hedge
fund that focuses on energy. “Tensions are as high as I can
recall, and the focus will only serve to further inflate the
supply risk premium.”
While Iran has said its nuclear program is for civilian
purposes, U.S and other Western governments have said Iran is
developing a capacity to produce nuclear weapons.
Iran’s Vice President Mohammad Reza Rahimi said on Dec. 27
that his nation may close the Strait of Hormuz, the passageway
for about a fifth of globally traded oil, if the U.S. and its
allies impose stricter economic sanctions in an effort to halt
his country’s nuclear research.
Crude oil for March delivery has advanced $3.59, or 3.6
percent, to $102.26 a barrel so far this week on the New York
Mercantile Exchange. Yesterday’s settlement was the highest
since Jan. 4. Prices are up 18 percent in the past year.
The oil survey has correctly predicted the direction of
futures 48 percent of the time since its start in April 2004.

*T
bg’s survey of oil analysts and traders, conducted
each Thursday, asks for an assessment of whether crude oil
futures are likely to rise, fall or remain neutral in the coming
week. The results were:

RISE NEUTRAL FALL
15 10 12
*T