Malcolm Graham-Wood
Independent Analyst
Its all about the Yemen, as for the first time for a while a good old fashioned geo-political flare-up adds five bucks to the oil price. Indeed, at one stage yesterday Brent nearly negotiated $60 but came off at the end and today its $50 and $58 for the pair. This is because people have worked out that there is only the slightest risk of any supply disruption from the Middle East as a result of this jousting. By now, as they did with things like the rig count, even the most amateur of commentators (not you Marcus, you are such a pro…) know what and where the Bab el Mardeb is and how it too can de diverted around. Not that the Houthi arsenal contains anything serious enough to stop shipping at 50 miles…one hopes.
Deal or no deal?
In all this and despite much chatter about Iran it should be noted that the next deadline is only four days away, so by Tuesday there will have to be either a deal or a further pushing of the debate into the long grass, the banker offers you short shrift and no surprise, despite optimism there are still many hurdles.
In a couple of hours we will see the latest Baker Hughes rig count, unless it is a massive surprise one way or another I have a feeling that the market is becoming rather inured to the process and oil will end up, up on the week.
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