The global oil market looks to be settling into a more stable position on Tuesday following the news that National Security Adviser John Bolton was fired. The price of oil fell around $1 a barrel as war fears dramatically fell on Bolton’s ouster.
Fear of the US attacking Iran has put a premium into the global oil market for some time, and Bolton was seen as the driving force in that effort. While he was by no means the administration’s lone hawk, the risk of an Iran war drops substantially on the news.
And while oil prices immediately dropped, there is a lot of hope among oil producers that this will make trade generally more stable and profitable. There is also substantial hope that an EU-Iran deal, which the US had previously rejected, may be back on the table.
The deal would see the EU providing Iran a $15 billion line of credit for 700,000 barrels of oil daily. Financial analysts say the deal is much more likely now, as Bolton was the big opponent.
While some argued that there was more downside risk to oil prices because Bolton would no longer be in a position to angle for a big war, there seems to be hope that this will make long-term development more possible, and pricing out future energy costs more reliable, benefiting many.