From the moment Western diplomats struck a deal over the weekend meant to halt Iran’s progress toward attaining nuclear weapons, the White House has emphasized that the easing of sanctions against Tehran is modest, highly conditional and possibly temporary. That pretty well describes the pact’s likely impact on world oil prices and financial markets as well.
Brent crude oil, the variety most closely tied to potential increased Iranian oil exports, slipped 2% in a reflex response to the agreement, to a bit over $108 a barrel. U.S.-centric West Texas Intermediate crude was dragged 1.4% lower, to beneath $94 a barrel. The dollar rallied and stock indexes around the world caught a bid, led overnight by Japan and Korea, which are particularly reliant on imported oil and gas.
Yet, for at least three reasons, investors shouldn’t expect the deal to pay ongoing dividends in the form of cheaper energy or big newRead More »from Don’t Expect a Big Payoff from the Western Pact with Iran