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>> Even before President Trump announced his decision Tuesday to pull out of the historic Iran nuclear deal, global markets were already pulling back from three-and-a-half year highs. The return of US sanctions, which could limit Iran's ability to sell oil, will ultimately lead to higher oil prices. But not yet, says Reuters energy editor David Gaffen.
>> There's going to be a lot of gnashing of teeth and back and forth over the Europeans, and the business that they are starting to do and transact with Iran. But the expectation essentially is that ultimately, this will pull supply off the market. And if it does that, that is, for the most part, bullish for oil prices, you would expect oil to rise on that a few dollars.
Would it be today or in the next day or two, probably not.>> There's concern among some traders that by pulling out of the multinational agreement, the unintended consequence could be a flare-up of geopolitical tensions in a region responsible for one-third of the world's oil supplies.>> This is likely to embolden politically the hardliners in Iran more than they have been as a result.
Because of the fact that their President Rouhani was part of this deal, and wanted to push it through to try to relieve sanctions from Iran. And if you have that removed, then they can credibly say, this isn't working, it's not helping our economy. And then you have people with a much more strident stance potentially in place to take power, or take power back at some point.
>> And there's another concern, what if Iran decides to start dumping oil on the market to get as much money as it can before any possible sanctions go into effect? Traders fear if that happens, the extra supply will drive oil prices lower.