Brent-WTI Spread Blows Out Again
Sober Look | Aug 17, 2012 06:44AM ET
As JPost : - Setting Iran’s nuclear plans back a few years to buy time for regime change or other unforeseen developments would be good in its own right, even if Israel cannot completely take out Iran’s nuclear program, Prime Minister Binyamin Netanyahu said recently, The Jerusalem Post has learned.
Netanyahu, in private meetings, repeated a number of times that before Israel’s 1981 attack on Iraq’s Osirak nuclear reactor, the Mossad and Military Intelligence were opposed because they thought the best that could be done was to delay the program for a couple of years.
With the heightened geopolitical risk, Brent is now viewed as having a great deal of the upside, while WTI, impacted by strong domestic production in the US, has the downside. This divergence is keeping the spread elevated.
Bloomberg: - “The Brent oil price is biased to the upside while the other is to the downside,” said Eugen Weinberg , head of commodities research at Commerzbank in Frankfurt. “On the WTI side, there are still high inventories, very high domestic production, high imports and anemic demand. On the other hand, maintenance work in the North Sea and latent geopolitical risks are pushing Brent higher.”
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