The conclusion is that different countries
have different effects from rise in oil price. Any change in one country will
affect all the countries. At this point of time Donald Trump is playing a big
role in the world as a whole. Oil and Dollar will play major role for every
countries economy. There is always a inverse relation between Oil and Dollar.
As the oil price increases the dollar value is depreciated which decrease the
dollar inflow for the country. It will Increase the foreign exchange deficit or
decrease the Foreign exchange surplus. Overall the world GDP will suffer
because of this decision as India and china are the major drivers for the world
The only benefit China will
receive is when crude oil price reaches breakout and there is a fight between
Saudi Arabia and Iran.
Silk Road initiative will also
come into limelight and it will be effected as Iran and US will be under trade
war that will result in depletion of the resources.
China imports the most oil
after US. As there is a rise in price it has effected it a lot as it has become
expensive for them to purchase.
GCC consists of Qatar, Saudi
Arabia, UAE, Kuwait, Oman and Bahrain. GCC holds strong advantage against Iran
when they couldn’t do anything in Yemen as it a costly war.
Dubai has potential to grow
with oil price increasing UAE has the potential to make more money and improve
its economy as Iran is helping them with the rise in the price of oil.
Iran is the biggest source of
imported goods. If there is no sanctions the export could grow and will be
beneficial to UAE.
If India doesn’t support Iran
then there maybe troubles in Chabahar project. This project is between three
countries Iran, India and Afghanistan. The making of this port is necessary for
exports from other countries. It will effect India badly.
US decision with the agreement may lead to
trade war. In which the US may demand the support from India. This will put
India in great trouble. If they support Trump then this will impact the
relationship between Saudi Arabia and Israel as they are a part of GCC.
India is the second largest
importer of crude oil from Iran. As they have raised the price it will make
Indian economy fluctuate with increase in price of oil which in turn reduces
the supply of oil as it is more expensive.
With increase price of the oil
it will affect the US as they consume oil the most in the world. The value is
around $22 million tones. Rise in the price will slowly effect and inflation
could take place.
With US not supporting the
nuclear deal, the foreign investment in Iran has reduced. Investors are not
confident to invest in Iran due to fluctuating economy.
Oil price is related to US
dollar. They are inversely related. If oil price increase the value of dollar
depreciates and vice-versa. With the increase or decrease of dollar, the
currency of other countries our effected.
Donald Trump wants to make changes in the deal
so that Iran couldn’t take the advantage of making a nuclear weapon. He wants a
stricter sanction for Iran’s ballistic missile program. So, he has refused to
renew the agreement which in turn made Iraq increase the price of oil. This had
impact all over the world.
Sanctions were imposed on
Iran from US, EU and UN which was going to be removed and it would be able to
make their economy stable.
The time has been
increased by the suggestion of the US this is because if Iran thinks to rush to
make nuclear bomb they will take substantial time.
In this IAEA, will continuously monitor, inspect and verify the
activities of Iraq.
This is used for building heavy- water nuclear facility and the reactor
contains plutonium for nuclear bomb.
In this Iran has been told
to reduce the isotope of U-235 to only 3-4% concentration. Uranium stockpile
has also been reduced from 98% to 3.67%. They have reduced the centrifuges.
The nuclear agreement has 5 main points: