Two major events rocked the oil and gas sector this morning.
But they weren’t tied to ubiquitous market volatility or natural disasters.
These were intentional – each a result of human decisions.
Whatever the cause, the result is that we are we are off to the races… and you and I have the opportunity to benefit nicely.
The Embargo Has Begun
First, the European Union (EU) in Brussels passed its anticipated oil embargo against Iran.
The EU also froze assets of the Iranian central bank in Europe. I have recently commented on what this action would mean to the oil markets, even if Tehran does not make good on its threat to close the strategic Strait of Hormuz.
Closing the strait, even for a short time, would lead to the quickest rise in oil prices on record.
But the likelihood of that taking place is uncertain. Iran, after all, gains 80% of its income from oil exports. They would experience a steep financial cut by their own hand.
More certain now are the major crude oil pricing issues that would result from withholding Iranian crude from the European market.