![\"Oil](\"https:\/\/shipandbunker.cdn.speedyrails.net\/a\/img\/_asp_d6afe34881134d19842789dd7a5fe7d4.v.652.jpg\")
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\n\tOil production is skyrocketing but a glut is unlikely, one analyst argues: File Image\/Pixabay.<\/p>\n
\u201c<\/p>\n \n\tThere will be more conflict, there will be more trouble<\/p>\n Fereidun Fesharaki, chairman emeritus, FGE NexantECA<\/p>\n
\n\tGlobal crude recovery growing far quicker than analysts predicted was cited<\/a>\u00a0as the reason for another session of losses on Monday for two key benchmarks; however, remarks made by U.S. president Donald Trump suggested that hostilities \u2013 and escalating oil prices \u2013 between the U.S. and Iran could easily resume.<\/p>\n
\n\tAfter Iranians vowed revenge during the funeral of their supreme leader Ayatollah Khamenei, Trump told <\/a>media that if a peace deal wasn\u2019t reached, Washington would \u201cfinish the job\u201d it started months ago, adding that it would completely dismantle the country\u2019s infrastructure \u201cin a small part of an afternoon.\u201d<\/p>\n
\n\tStill, Brent settled down 13 cents at $71.99 per barrel, and West Texas Intermediate settled down 14 cents at $68.55 per barrel.<\/p>\n
\n\tGiovanni Staunovo, analyst at UBS, explained why traders weren\u2019t spooked by the sabre-rattling between the U.S. and the Islamic republic: “The downward move is still influenced by earlier stranded tankers managing to exit \u2060the [Persian] Gulf, resulting in an increase in oil on water.”<\/p>\n
\n\tIndeed, investors and analysts alike continued to witness oil ramping up elsewhere at an unprecedented rate: having quit its membership with the Organization of the Petroleum Exporting Countries (OPEC), the United Arab Emirates raised<\/a>\u00a0its crude output to near record highs above 3.8 million barrels per day (bpd) in June, according to sources.<\/p>\n
\n\tMeanwhile, OPEC on Sunday agreed to increase output targets by 188,000 bpd from August, in addition to increases for June and July.<\/p>\n
\n\tAlso, Saudi Arabia set the official selling price for its flagship Arab Light crude to Asia in August at $1.50 per barrel below the Oman\/Dubai average, and this caused Robert Yawger, director of energy futures at Mizuho, to remark, “It is increasingly looking like the Gulf producers are gearing up for a price war.”<\/p>\n
\n\tHowever, at least one analyst thought the mounting fears of an oil glut were unfounded, due to peace between the U.S. and Iran being extremely unlikely.<\/p>\n
\n\tFereidun Fesharaki, chairman emeritus of FGE NexantECA, told<\/a>\u00a0 media that he found it \u201cimpossible to imagine\u201d both countries reaching a lasting peace deal and added, \u201cThere will be more conflict, there will be more trouble, this is not the end of the story; this is the beginning of the story.\u201d<\/p>\n
\n\tFesharaki also said that as a result, while up to 75 percent of the previous oil flows through the Strait of Hormuz are expected to return to the market by the end of the year, significantly lower oil prices aren\u2019t guaranteed for 2027.<\/p>\n