The prices of oil saw a slight increase on Monday and managed to become positive this Monday after a session that was volatile and had seen an increase of 2% in the early trade before it went into the red but ultimately settled with little change. The action had come despite the fears ongoing that Iran is going to react against the interests of United States.
Analysts feel that the calculus is going to depend on what Iran is going to do. As of now Iran has not taken any action however the uncertainty is causing some unrest. There has been a major deployment of troops in the region as of now and hence there is speculation of something being underway as per the analysts.
After the death on Thursday of Iran’s military leader Qaseem Soleimani, Iran has vowed retaliation which has been causing the anxiety related to the direction of the next move of oil.
In case the nation is going to target the production in Iraq or Saudi Arabia which are the two largest producers of OPEC, it would mean that the prices might be moving higher.
It wasn’t too long ago that an event of this kind might have triggered a major spike in the prices of oil which is indicative as per experts of oil becoming a lagging indicator.
The experts have said further that there are many participants of the market who are going to be waiting to see whether there is an actual disruption in physical supply. The analysts feel that there is a segment in the market which believes that this is going to just blow over.