‘Iran Effect?’ Gas Prices Set to Tumble in August

The Iran nuclear deal may be bad from a security point of view, but pundits who evaluate the price of oil believe it will have a very strong effect in lowering the cost of that commodity. That will have an effect on all countries that buy oil – including Israel.

According to analysts, the “Iran effect” on oil prices may already be coming into play – and as a result, they said, Israelis could see the price of gas fall by as much as 17 agurot (five cents) when government-controlled maximum prices are set at the beginning of August.

Already last week, oil prices tumbled as producers and investors anticipated a significant cut in the market price of crude oul as Iran ramps up production and begins selling on the world market again as sanctions against Tehran are lifted.

It should be noted that the agreement to regulate Iran's nuclear program has not yet come into effect – but already prices are lower than they were at the beginning of July, although there was some recovery in prices last week.

Analysts expect prices to continue falling as anticipation of the new supplies becomes part of market sentiment. Currently, crude oil prices are around $50 a barrel.

If the analysts are right, prices for 95 octane gas could fall to NIS 6.5 per liter ($6.65 per gallon).

Source: http://www.israelnationalnews.com/News/News.aspx/198534

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