While the Biden Administration is asking for restraint from Israel, Israeli Prime Minister Benjamin Netanyahu replied that this is a “Historic Opportunity” one that I doubt Israel will let pass by.
A strike on Iranian oil infrastructure should send crude oil up at least $10 a barrel and if Iran attacks Saudi Arabia for example, the spike could be as high as $20 a barrel as S&P Global reminds us that the Israel- Iran conflict could disrupt the source of 30% of the world’s oil and crucial Maritime routes.
Bloomberg reported that Israel’s public television just published an “inside-the-room” of the Biden-Netanyahu phone call. They reported that Biden pushed against an attack on Iran’s nuclear and oil infrastructure. I wonder why? It was reported that Israel’s current thinking is for a retaliation larger than what Biden would like. Biden came into office trying to appease Iran by trying to resurrect the deeply flawed Iranian nuclear deal and that appeasement has had disastrous consequences for Israel and the world.
Prime Minister Netanyahu realizes that appeasing Iran, the biggest state sponsor of terror, was a mistake. Iran’s s influx of cash from oil and unfreezing of Iran’s frozen bank accounts led to the funding of terror.
The world's biggest state sponsor of terror was allowed to fund groups like Hamas, Hezbollah, and the Houthi rebels. Netanyahu knows that Iran is the axis that drives this evil. Iran's oil revenue promotes these terror groups that do not discern the difference from a military and a civilian target and uses human shields, the ultimate act of cowards.
Most importantly Iran’s quest to get a nuclear weapon must also be thwarted. Any country whose motto is ‘Death to America’ and has a goal to ‘wipe Israel off the map’, cannot be allowed to get the capability to follow through on their mission.
So, it is likely that Israel will attack Iran’s nuclear facilities as well as their oil facilities in a quest to cut off Iran’s ability to fund more death and destruction. Israel’s security cabinet met yesterday and voted on a proposal to authorize Israeli Prime Minister Benjamin Netanyahu and Defense Minister Yoav Gallant to determine the country’s response to last week’s Iranian missile attack.
It was reported that according to Israeli sources, “Despite the Israeli Security Cabinet meeting last night for several hours, no final decision was taken regarding a retaliatory strike against Iran! Some officials want to postpone a response as long as possible to maintain the “element of surprise” against Iran. The only surprise at this point would be if Israel decided not to act and take advantage of this historic opportunity to take out the biggest threat to peace and reconciliation in the Middle East. And Iran is indeed getting prepared for an attack.
Reports are saying that Iran is moving oil tankers and mixed reports about Iranian exports. Some are reporting that they are way down and others are reporting that they’re way up. This week Saudi Arabia cut prices to Asia, and it seems like OPEC compliance is improving from over-producer Iraq.
This is a sign that the reports about the OPEC division were overrated as the characters in the cartel reign in overproduction. S&P Global in their survey reported that “OPEC+ crude oil production fell 500,000 b/d month-on-month to 40.23 million b/d in September, largely due to a major shutdown in Libya and cuts to Iraqi exports, refinery runs and direct burn, the Platts OPEC+ survey from S&P Global Commodity Insights showed Oct. 10. S&P Global says that the output cut will ease pressure on overproducers who have faced growing calls to comply with their quotas in 2024, as the group aims to shore up prices in the face of demand uncertainty and booming non-OPEC+ output.
The desire to be short over the weekend betting on hopes that Israel does not attack is a very dangerous bet but could be very lucrative. At the same time if you’re short and they do attack, it could be very dangerous. As we live headline to headline, for day traders the opportunities have been amazing in this market with high volatility.
While option prices seem to be expensive, they’re probably expensive because they’re worth it. Based on the potential move and risks. There are many option strategies for what may or may not be coming. Just remember to control your risk. You can call me if you need some ideas.
Natural gas is coming back as power is slowly being restored in Florida. At one point over 4 million people were out of power. Still despite the devastation that we saw, we thank God it wasn’t the worst-case scenario. I told RigZone that Hurricane Milton was, “giving a hit to demand” for natural gas “Gulf natural gas production [is] not impacted and is at full strength … So, demand destruction selling,” he added.
Jim Krane, a Research Fellow at Rice University’s Baker Institute, told Rigzone that U.S. natural gas prices have been volatile lately. “There’s been a lot of uncertainty about hurricane-related power outages in Florida killing off gas demand,” he said. “But in the longer-term demand should rebound on cooling temperatures and power restoration in Florida,” he added.
Art Hogan, Chief Market Strategist at B. Riley Wealth, told Rigzone that, “natural gas prices seem to be reacting to both the U.S. Energy Information Administration data that showed an increase in production last week, and a downgrade of Hurricane Milton as it exits Florida”.
A Rystad Energy gas and LNG market update from Rystad Senior Analyst Masanori Odaka, which was sent to Rigzone by the Rystad team earlier on Thursday, noted that “the front-month Henry Hub gas price was 7.8 percent lower week on week at approximately $2.7 per million British thermal units (MMBtu) on 9 October”. “Total feed gas levels for U.S. LNG projects increased to around 12.8 billion cubic feet per day (Bcfd), 5.5 percent higher week on week,” it added.