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Oil Rallies After Iran Concludes Negotiations About Nuclear Program

July 14, 2015 at 21:02 by Vladimir Vyun

Crude oil demonstrated a sizable rally today following the announcement that Iran concluded negotiations with the Western nations about the Iranian nuclear program and the resulting deal should allow the Middle Eastern country to resume oil exports to the West. The gains were rather surprising to market analysts as the news is very bearish for the commodity. Indeed, prices dropped sharply after the announcement but only to bounce later.

So what is the reason for the sharp turn of the sentiment? Specialists explain that Iran will not be able to resume exports fast, meaning that the increase in supply to the market will not be significant in the near term. While Iranian oil may be bearish for the market over the longer term, for now there are few reasons to worry, and the increase in supply is priced in anyway.

Futures for delivery of WTI crude oil in August climbed 1.28 percent to $52.87 per barrel as of 20:59 on NYMEX today. Contract for Brent crude gained 0.92 percent to $58.38 per barrel on ICE.

If you have any questions and comments on the commodities today, use the form below to reply.

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