Concerns of an escalation in the Middle East remain overblown re elevated crude oil prices

Rabobank analysts on oil:

• “The concerns of an escalation in the Middle East between Iran and Israel again remain overblown with regard to elevated crude oil prices”
• “Only direct action between Saudi Arabia, Iran, and the United States toward some kind of blockade or closure of the Strait of Hormuz will materially affect the global crude oil and natural gas supply”

Nevertheless, Rabo say that the fears of a wider conflict will keep Brent crude above US$70 a barrel.

If there is an escalation and prices rise the analysts say the best trade is to sell the spike.

This article was written by Eamonn Sheridan at www.forexlive.com.