Newsmax TV & Webwww.newsmax.comFREE - In Google Play
Newsmax TV & Webwww.newsmax.comFREE - On the App Store
Tags: gasoline | price | iran | eu

Price of Gasoline Will Head Higher Now

By    |   Monday, 02 July 2012 08:04 AM EDT

Get ready to “pay up” at the pump soon as the EU and U.S. put pressure upon Iran to halt its nuclear-enrichment program.

The EU sanctions have just started against Iran. The sanctions which ban insurance for ships carrying Iranian oil are expected to pull off 1 million barrels of oil a day from Iran’s daily production presently of 3.3 million barrels a day. The ban ensures that it covers 95 percent of the ships that could potentially carry Iranian oil.

So the EU has their hands tightly around Iran’s pocketbook right now. After all, oil and oil derivatives account for nearly 80 percent of Iran’s exports and about half of their government revenue.

Editor's Note: Join the 3.5% of Americans who are truly wealthy and financially secure.

Keep in mind that Iran is OPEC’s second biggest oil producer…so this is a huge deal right now.

In fact, this is likely going to be the biggest supply disruption in the Middle East since the whole Libya “armed rebellion” last year.

On top of this, oil workers are striking in Norway’s North Sea fields which are also beginning to curb oil flows right now.

But back to Iran…they’re stewing over all of this, naturally. For instance, Iran’s governor to OPEC, Mohammad Ali Khatibi said that the EU would bear the consequences of politicizing the market.

Iran’s central bank governor, Mahmoud Bahmani said that Iran isn’t sitting idly by and that they have a very suitable $150 billion in foreign currency reserves to help weather the latest trade and financial curbs. He went on to say that they had programs to fight the sanctions.

We’ll see. I’m personally not betting on Iran. I’ll bet with the EU and the U.S.

Remember, back on Dec. 31, the U.S. said they would cut off international banks from the U.S. financial system if they settle oil trades with Iran. The U.S. gave China, India and Japan until June 28 to demonstrate that they had significantly reduced their purchases of Iranian oil in order to qualify for exemptions.

So how is all of this going to play out? It’s likely to get uglier before it gets prettier. Countries are playing hard-ball right now.

Iran has recently said that it can strike any target in the Strait of Hormuz and that they will soon equip ships with missiles capable of firing more than 186 miles.

Editor's Note: Join the 3.5% of Americans who are truly wealthy and financially secure.

Remember, about a fifth of the world’s crude goes through the Strait of Hormuz. So just the talk like this can send the price of oil soaring.

But being that there are sanctions that will pull off a third of Iran’s oil offline and there are strikes in Norway…it’s almost assured to jolt the price of oil higher in the coming months.

And that means higher gas prices at the pump for you and me.

Now my Ultimate Wealth Report subscribers and I are well positioned for this. We didn’t come into it blindly. We’ve got an oil play in our portfolio that’s going to benefit very nicely from all of this.

So while gas prices will go up…so will our account balances in our investment accounts. So we’re going to make it through this period much better than most of America which hasn’t positioned themselves ahead of time for this.

Make sure you’re positioning your assets to where they’ll not get eaten up as the EU and U.S. apply pressure on Iran. The last thing you want to have happen is to get your finances caught in the middle of all of this mess.

About the Author: Sean Hyman
Sean Hyman is a member of the Moneynews Financial Brain Trust. Click Here to read more of his articles. He is also the editor of Ultimate Wealth Report. Discover more by Clicking Here Now.

© 2023 Newsmax Finance. All rights reserved.

Monday, 02 July 2012 08:04 AM
Newsmax Media, Inc.

Sign up for Newsmax’s Daily Newsletter

Receive breaking news and original analysis - sent right to your inbox.

(Optional for Local News)
Privacy: We never share your email address.
Join the Newsmax Community
Read and Post Comments
Please review Community Guidelines before posting a comment.
Get Newsmax Text Alerts

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

© Newsmax Media, Inc.
All Rights Reserved
© Newsmax Media, Inc.
All Rights Reserved