Crude prices move towards $111 on Monday

Crude prices move towards $111 on Monday The prices of Brent crude moved towards $111 on Monday as concerns over supply disruption due to reactions from Iran.

The Islamic Republic of Iran has warned Gulf countries of consequences if they raised oil output to replace supply from Iran. Even as western countries made alternative arrangements for replacing Iranian oils the international market remained concerned over disruptions.

Iran is suspected of covertly developing nuclear weapons, a charge it denies and maintains that it has the right to harness civilian nuclear energy for generating power. A final decision on the ban of Iranian oil is expected to be taken before the end of January and will be enforced in planned phases in order not to disrupt global oil supplies.

The combined tough stance is to force the Iranian authorities to stop enriching uranium and negotiate with the western powers to end its efforts of developing fuel for an alleged nuclear weapon.

Iran has responded to the threat of sanctions with a series of military and diplomatic threats including closing the Strait of Hormuz. It test fired new missiles and also announced the production of its first nuclear-fuel rod. The country has also warned against the return of an American aircraft carrier to the Persian Gulf.

Top Iranian importers, China, Japan and South Korea are considering alternative Middle East suppliers while the United States has increased the pressure on all countries to reduce imports from Iran