What a failed Iran deal would mean for oil prices and military tensions

ATTA KENARE | AFP | Getty ImagesThe Iranian nuclear deal looks all but dead just one year after the President Donald Trump administration walked away from it and reimposed crippling sanctions on the Islamic Republic. The oil price impactThe direction of oil prices will depend on what Iran does with its nuclear program in the event of the deal’s termination, and whether Tehran’s strategy triggers a military response. “An actual military confrontation or even limited military strikes could cause p


ATTA KENARE | AFP | Getty ImagesThe Iranian nuclear deal looks all but dead just one year after the President Donald Trump administration walked away from it and reimposed crippling sanctions on the Islamic Republic. The oil price impactThe direction of oil prices will depend on what Iran does with its nuclear program in the event of the deal’s termination, and whether Tehran’s strategy triggers a military response. “An actual military confrontation or even limited military strikes could cause p
What a failed Iran deal would mean for oil prices and military tensions Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-07-19  Authors: natasha turak
Keywords: news, cnbc, companies, program, tensions, mean, iran, failed, deal, military, iranian, oil, nuclear, war, sanctions, prices


What a failed Iran deal would mean for oil prices and military tensions

Iranian soldiers take part in the “National Persian Gulf day” in the Strait of Hormuz, on April 30, 2019. ATTA KENARE | AFP | Getty Images

The Iranian nuclear deal looks all but dead just one year after the President Donald Trump administration walked away from it and reimposed crippling sanctions on the Islamic Republic. As Iran’s government starts breaking its agreed uranium enrichment limits, European leaders are floundering to keep it alive. British Foreign Secretary Jeremy Hunt claimed Monday that the Obama-era deal — signed by the U.S., U.K., Iran, Russia, China, France and Germany in 2015 and intended to provide Iran economic relief in exchange for limits on its nuclear program — “isn’t dead yet.” Other European lawmakers frantically stress the dangers of killing the deal, while Tehran says it can always reverse its deal breaches if the EU defies American sanctions and resumes trade with Iran — something it appears largely unable or unwilling to do. For many Iran watchers, the deal has already collapsed. But what will happen if it officially ends, and what are the consequences for the world?

The oil price impact

The direction of oil prices will depend on what Iran does with its nuclear program in the event of the deal’s termination, and whether Tehran’s strategy triggers a military response. “If the deal dies and Iran starts enriching uranium again at 20% levels and spinning the higher speed centrifuges, we will be closer to a military confrontation involving the U.S. and Iran or potentially Israel and Iran,” Helima Croft, global head of commodity strategy at RBC Capital Markets, told CNBC Thursday. “An actual military confrontation or even limited military strikes could cause prices to temporarily spike.”

Iranian leaders have repeatedly claimed they are not after acquiring nuclear weapons, rather civilian nuclear energy. But before the 2015 deal went into action the country was enriching uranium — the fissile material required for a bomb — at 20%, far above the 3.67% level required for an energy program and roughly three months away from reaching 90% enrichment, or weapons-grade uranium. Under the deal, international inspection agencies verified that Iran had brought enrichment down to 3.67%, the level it now says it’s breaching at just over 4%.

For the U.S., I think it all depends on Trump’s domestic political considerations and who is whispering in his ear on a nightly basis. Richard Nephew Program director at the Center on Global Energy Policy, Columbia University, former State Department sanctions expert

“If war were to break out, we estimate that the price of oil would quickly surge to around $150 per barrel following the outbreak of hostilities,” analysts at London-based Capital Economics said in a research note last week. Twenty million barrels of crude per day are produced in the Persian Gulf. Conflict could prompt the closure of the Strait of Hormuz, through which one-third of the world’s seaborne oil passes. Still, oil watchers point out that with the U.S. shale boom and less global reliance on the Persian Gulf than in previous years, there’s probably enough slack in the international market to bring prices back down. “The deal dying and Iran continuing a staged nuclear restart that still keep it fairly far away from reaching nuclear breakout capability could put a floor under oil prices,” Croft said, but with weak demand concerns still high, it “may not move the needle much.”

Military response: Trump’s call

Most analysts maintain war in the Persian Gulf remains unlikely, but fear that with tensions so high and no diplomatic channel of communication, a mere miscalculation could set off a serious conflict. “For the U.S., I think it all depends on Trump’s domestic political considerations and who is whispering in his ear on a nightly basis,” Richard Nephew, sanctions expert and program director at the Center on Global Energy Policy at Columbia University, told CNBC. Trump’s hawkish National Security Advisor John Bolton “had that upper hand for a while,” Nephew said. “Now, it looks like the isolationists do.”

National Security Advisor John Bolton with that notebook as he listens to questions from reporters during a press briefing at the White House January 28, 2019 in Washington, DC. During the briefing, economic sanctions against Venezuela’s state owned oil company were announced in an effort to force Venezuelan President Maduro to step down. Win McNamee | Getty Images News | Getty Images

With his reelection campaign underway and a long-touted pledge to end America’s Middle East wars, recent actions like seemingly absolving Iran of harsh blame for shooting down a U.S. drone in June and calling off a planned retaliatory strike suggest Trump is very reluctant to go to war. However, Trump said Thursday that a U.S. Navy ship had destroyed an Iranian drone in a “defensive action” in the Strait of Hormuz earlier that day. Nephew believes that Iran “will proceed cautiously on the nuclear side and in ways that are non-attributable — where possible — on the regional side.” Some security experts suggest a “surgical strike” on Iranian nuclear facilities by the U.S., if anything, rather than an all-out war. In terms of military capacity, the U.S. has a far greater range than Iran, says Michael Rubin, a former Pentagon official and resident scholar at the American Enterprise Institute in Washington, D.C. “Sure, Iranian speedboats or drones can harass shipping,” Rubin said. “But if the Iranians go too far, the U.S. Navy can strike Iranian small boats and ports from hundreds of miles away in the Indian Ocean, and the Iranian military would have no effective defense.”

Israel’s ‘any means necessary’

Israel, for its part, has said it will use any means necessary to prevent Iran from acquiring a nuclear bomb, though its internal deliberations on the matter are incredibly complex. Between 2010 and 2012 Israel’s intelligence agency, the Mossad, is believed to have been behind the assassinations of four of Iran’s top nuclear scientists, and in 2007 it carried out airstrikes against a suspected nuclear facility in Syria. If Israel were to strike Iran, the big question will be whether the U.S. follows suit and how Iran would respond, which some analysts say would be likely via rocket attacks by its Lebanese proxy Hezbollah. Tamas Varga, a business analyst at PVM Oil Associates in London, still sees a U.S. move toward war as highly unlikely, especially with the 2020 elections looming. “With the U.S. presidential campaign underway, the last thing Donald Trump would need is a jump in domestic retail gasoline prices,” Varga said. “Never say never, but military conflict is currently not plausible.”

What will the nuclear threat look like?


Company: cnbc, Activity: cnbc, Date: 2019-07-19  Authors: natasha turak
Keywords: news, cnbc, companies, program, tensions, mean, iran, failed, deal, military, iranian, oil, nuclear, war, sanctions, prices


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How dairy behemoth Danone failed to win India’s 1.35 billion dairy lovers

India is the world’s top producer and consumer of dairy — in 2018 alone, the country’s 75 million dairy farmers produced 410 billion pounds of milk, about 22% of global production. With this and its dairy-heavy diet of curries and yogurt drinks, the giant French dairy company Danone hoped to find success in the country, opening its own production line in 2011. But this division failed to account for more than 10% of its sales in India, the vast majority instead coming from its “specialized nutri


India is the world’s top producer and consumer of dairy — in 2018 alone, the country’s 75 million dairy farmers produced 410 billion pounds of milk, about 22% of global production. With this and its dairy-heavy diet of curries and yogurt drinks, the giant French dairy company Danone hoped to find success in the country, opening its own production line in 2011. But this division failed to account for more than 10% of its sales in India, the vast majority instead coming from its “specialized nutri
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Company: cnbc, Activity: cnbc, Date: 2019-07-19  Authors: karin shedd
Keywords: news, cnbc, companies, vast, lovers, production, billion, dairy, indias, danone, 135, company, behemoth, success, yogurt, specialized, india, worlds, failed, win


How dairy behemoth Danone failed to win India's 1.35 billion dairy lovers

India is the world’s top producer and consumer of dairy — in 2018 alone, the country’s 75 million dairy farmers produced 410 billion pounds of milk, about 22% of global production. With this and its dairy-heavy diet of curries and yogurt drinks, the giant French dairy company Danone hoped to find success in the country, opening its own production line in 2011.

But this division failed to account for more than 10% of its sales in India, the vast majority instead coming from its “specialized nutrition” segment. Analysts say that India’s highly localized, fractured dairy industry confounded Danone, a company accustomed to the relatively more consolidated dairy industries of the U.S., where it goes by the name “Dannon,” and its native France.

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Company: cnbc, Activity: cnbc, Date: 2019-07-19  Authors: karin shedd
Keywords: news, cnbc, companies, vast, lovers, production, billion, dairy, indias, danone, 135, company, behemoth, success, yogurt, specialized, india, worlds, failed, win


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84% of millennials and Gen Z failed this retirement quiz. See how you compare

In fact, when employers offered ongoing financial education, employees were 66% more likely to stay with that employer, per the report. That said, Fisher believes employers could make it easier for employees to take advantage of retirement options offered to them. Select all the statements below that describe what a mutual fund is. You can select all of the statements or a mix of some of the statements to answer this question. If you are not sure what a mutual fund is you can select “I’m not sur


In fact, when employers offered ongoing financial education, employees were 66% more likely to stay with that employer, per the report. That said, Fisher believes employers could make it easier for employees to take advantage of retirement options offered to them. Select all the statements below that describe what a mutual fund is. You can select all of the statements or a mix of some of the statements to answer this question. If you are not sure what a mutual fund is you can select “I’m not sur
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Company: cnbc, Activity: cnbc, Date: 2019-07-05  Authors: alicia adamczyk
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84% of millennials and Gen Z failed this retirement quiz. See how you compare

“Participants can fall behind in their retirement savings simply because they don’t know how much to save, and because they don’t understand the impacts of choosing an investment mix or how compound interest works to their benefit,” notes the report. In fact, when employers offered ongoing financial education, employees were 66% more likely to stay with that employer, per the report. Nathan Fisher, founder and senior executive vice president of Fisher Investments 401(k) Solutions, tells CNBC Make It that it’s not surprising that retirement knowledge is lagging for younger workers, who are likely not thinking about 30 to 40 years down the road when they have more imminent financial considerations — like making rent and paying off student loans — to deal with now. “I personally believe that our brains are wired to deal with things right here, right now,” says Fisher. “There’s so much to pay attention to and [retirement planning] really gets drowned out.” That said, Fisher believes employers could make it easier for employees to take advantage of retirement options offered to them. In fact, he says a company with a well-run retirement program probably does offer educational opportunities like financial planning sessions, if employees know how to take advantage of them. He recommends reaching out to your human resources department to see what’s available.

What workers don’t know about their 401(k)s

Here are the two questions Fisher Investments 401(k) Solutions asked that tripped up the most respondents: Based on rules defined by the Internal Revenue Service at what age can you withdraw money from your retirement plan without a tax penalty? 62 61.5 61 60.5 60 59.5 58.5 Correct answer: 6. Just 27% of respondents answered correctly. Select all the statements below that describe what a mutual fund is. You can select all of the statements or a mix of some of the statements to answer this question. If you are not sure what a mutual fund is you can select “I’m not sure what a mutual fund is.” A mutual fund is an investment vehicle that is made up of a pool of funds collected from many investors The decisions to buy and sell securities in a mutual fund are made by one or more portfolio managers A mutual fund is limited to no more than ten different financial securities in the portfolio There are no fees associated with owning a mutual fund I’m not sure what a mutual fund is Correct answers: 1 & 2. Just 23% of respondents answered correctly. Don’t miss: Here’s how to figure out how much money you need to retire early Like this story? Subscribe to CNBC Make It on YouTube!


Company: cnbc, Activity: cnbc, Date: 2019-07-05  Authors: alicia adamczyk
Keywords: news, cnbc, companies, statements, failed, select, retirement, 84, sure, mutual, gen, millennials, dont, respondents, quiz, fund, fisher, financial, compare


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