There is a lot on the plate for oil this week. Not only do we have the Fed meeting we have the possibility of new sanctions on Russia and the potential pullback from the Iranian nuclear deal. This came against a backdrop of surging global demand for oil and related products.

The Fed should raise rates a quarter and the market then will focus on how many more times the Fed will raise rates this year. While we seemed to be moving towards four rate hikes, but now with a pullback in growth forecast by the Atlanta Fed, the odds are the Fed will not change their outlook at all. So, three hikes are what we can expect.

President Trump meets with Saudi Arabia’s Crown Prince Mohammed bin Salman, and the meeting, along with the firing of Rex Tillerson is raising the odds in the mind of the market of canceling of the nuclear deal. Leaders in Europe seem desperate to want to keep the deal in place and may try to talk to the Trump administration to get the U.S. to stay in the deal. Talk from folks close to the White House seems to be suggesting that the U.S. could find some room to negotiate the current deal. In the meantime, the fact is that MBS called Ayatollah, Khamenei, “the new Hitler” of the Middle East. An interview on CBS’ 60 minutes went like this:

Norah O’Donnell: But I’ve seen that you called the Ayatollah, Khamenei, “the new Hitler” of the Middle East.
Mohammed bin Salman: Absolutely.
Norah O’Donnell: Why?
Mohammed bin Salman: Because he wants to expand. He wants to create his own project in the Middle East very much like Hitler who wanted to expand at the time. Many countries around the world and in Europe did not realize how dangerous Hitler was until what happened, happened. I don’t want to see the same events happening in the Middle East.
Norah O’Donnell: Does Saudi Arabia need nuclear weapons to counter Iran?
Mohammed bin Salman: Saudi Arabia does not want to acquire any nuclear bomb, but without a doubt, if Iran developed a nuclear bomb, we will follow suit as soon as possible.