The weekend terrorist attack in Iran could be more important to oil prices than Sunday’s OPEC meeting, as the attack could exacerbate a rivalry in the most crucial oil-producing region in the world, analysts at RBC Capital Markets said on Sunday.
While a joint committee of OPEC and allies met in the weekend to discuss the state of the oil market, refraining from issuing any recommendation on lifting oil production, an attack on a military parade in the city of Ahvaz in Iran killed 25 people, including 12 of Iran’s elite Islamic Revolutionary Guards Corps, who vowed a “deadly and unforgettable” revenge for the terrorist attack.
On Sunday, the OPEC/non-OPEC Joint OPEC-non-OPEC Ministerial Monitoring Committee (JMMC) met in Algeria and said that “despite growing uncertainties surrounding market fundamentals, including the economy, demand and supply, the participating producing countries of the DoC continue to seek a balanced and sustainably stable global oil market, serving the interests of consumers, producers, the industry and the global economy at large.”
In a note on Sunday, as carried by CNBC, RBC Capital Markets analysts, led by global head of commodity strategy Helima Croft, said that:
“We believe that Saturday’s terrorist attack in Iran could prove to be the weekend’s more consequential event as it will likely exacerbate the already dangerous Middle East antagonisms.”