The United States terminated the Iran nuclear deal and now sanctions have been placed on Iran until a new agreement is made. President Trump is confident that Iran will be hurt economically and the sanctions will diminish influence in the Middle East. He hopes that the sanctions will force Iran to come to terms with the United States and create a new deal that will benefit America. The sanctions are meant to punish Iranian oil exporters and corporations that try to conduct business with Iran. There are some who have voiced concerns that putting sanctions on Iran would cause oil prices to rise. President Trump feels that these sanctions will put enough hurt on the Iranian economy without causing oil prices to spike higher. While the Trump Administration feels the oil market will remain steady while sanctions are placed on Iran, it may be the American consumer who gets hit with higher prices in the long-run. Matt Badiali is a financial advisor who feels that the Iran sanctions are going to result in higher oil prices, regardless of what the Trump administration believes.
After the sanctions officially went into effect, the oil market had no reaction. Matt Badiali believes the oil market has temporarily shrugged off the idea of sanctions because there are eight countries that the United States is allowing to continue to purchase Iranian oil for another six months. Also, China has stated that they intend to ignore the sanctions the United States places on Iran and intend to continue purchasing Iranian oil. Before the sanctions took effect, the United States and Saudi Arabia ramped up oil production to increase global supply in anticipation of the sanctions. Matt Badial feels these factors will only keep oil prices in check for a little while. He points out that Venezuela has been producing substantially less oil and he is predicting that Venezuela will continue to see it’s oil production decrease in the next several months.
Matt Badiali’s Freedom Checks Exposed. Matt Badiali also estimates that after the six month grace period for the nations able to buy Iranian oil, Iran’s production could drop by 900,000 barrels a day. Matt Badiali says there is no way that other counties could fill this deficit.
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