Oil prices could break below $20 this year as tensions simmer between Iran and Saudi Arabia, two of the world’s largest oil players, Again Capital founding partner John Kilduff said Monday.
“I think you’re going to get as low as $18 and maybe get as high as $48 … It’s going to get really ugly,” he told CNBC’s “Squawk Box. “The Iranians doubled down again, if that’s even possible, by saying that they could put 500,000 more barrels on the market within weeks after the sanctions get lifted.”
Kilduff was referring to the anticipated lifting of sanctions related to Iran’s nuclear program, which have locked the country out of international oil markets.
Saudi Arabia on Sunday cut diplomatic ties with Iran after the former’s supreme leader Ayatollah Ali Khamenei said the Saudis would face “divine revenge” for its execution of prominent Shiite cleric Sheikh Nimr al-Nimr, one of 47 put to death over the weekend. Protesters stormed the Saudi embassy in Tehran following the announcement of Nimr’s death.
Saudi Arabia is the dominant Sunni Muslim power in the Middle East, while Iran is led by Shiites.
Source: CNBC | Tom DiChristopher