A “crescent of chaos” emerging from the Middle East and North Africa (MENA) region and tensions with Iran could lead to a dramatic turnaround in the price of oil, according to Nomura’s analysis.
Brent crude, which fell to an eight-month low last week on weak U.S. jobs data, is set to climb following Iran’s presidential election in June,the firm said in research published on Tuesday.
Brent crude, which has spent the vast majority of the last two years range-bound between $105 and $120 per barrel, surged close to a two-year high when civil unrest broke out in Libya two years ago, but Iran now poses the biggest threat according to senior political analyst Alastair Newton.
(Read More: March Jobs Number Hurts Crude)
“It would be wrong to single out Iran to the exclusion of all other drivers of the price of oil in the MENA region, however,it has certainly been the most important,” said Newton.
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