Markets are soaring above $70 this morning as we approach Trump’s expected re-imposition of sanctions on Iran. Crude oil prices ended last week above $69, and weekend trading brought prices above $70. Currently, WTI crude prices are $70.43, up 71 cents (1.0%) over Friday’s close.
Refined fuel prices are also trending higher. Diesel prices are $2.1772, up 2.3 cents (1.1%) over Friday’s ending price. Gasoline prices saw similar gains, trading 2.2 cents (1.0%) higher at $2.1355.
Markets will be volatile this week leading up to Trump’s May 12 deadline to extend Iran sanction waivers. Expect statements from foreign ministers and negotiators to drive prices higher and lower throughout the week, but the overall trend will likely be towards higher prices as markets sort through the implications of the deal.
Adding to the tensions, Venezuelan production continues plummeting. The International Energy Agency reported recently that Venezuela’s production could fall to a 70-year low this year, at 1.38 MMbpd. Venezuela’s president Maduro is up for reelection on May 20, which most international actors agree will not be transparent or fair. Most opponents to Maduro’s reelection are advocating banning the polls, rather than supporting an alternative. Maduro’s reelection will continue his destabilizing effect on Venezuela’s economy, and on international oil prices.