DTN Oil Update
Oil Slips After Trump Alleges Iran Strike Postponement
VIENNA (DTN) -- Oil futures edged lower Tuesday morning after U.S. President Donald Trump said he had put on hold planned Tuesday attacks on Iran amid the current ceasefire.
Near 08:00 a.m. EDT, ICE Brent for July delivery was down $1.07 to trade near $111.03 barrel (bbl) and NYMEX WTI for June delivery fell $0.28 to $108.38 bbl.
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Downstream, NYMEX ULSD futures for June delivery softened $0.0305 to $4.0840 gallon and front-month NYMEX RBOB futures slipped by $0.0423 to $3.7184 gallon.
The U.S. Dollar Index was little changed, up 0.045 points to 99.15 against a basket of foreign currencies.
The president on Monday claimed he postponed new strikes on Iran scheduled for Tuesday at the request of the leaders of Qatar, Saudi Arabia and the United Arab Emirates, alleging "serious negotiations" were taking place. Oil prices slipped in response to the announcement.
The month-long ceasefire has so far mostly held, allowing for potential negotiations. Tehran's key demands for peace were little changed in its latest proposal submitted to the United States. Iranian state media reported that the peace offer included an end of Israeli strikes on Lebanon, the lifting of sanctions, a reduction of U.S. military presence in the region and the payment of reparations. The White House is reportedly open to sanctions relief but has in the past ruled out war damage reparations and a military scale back.
The U.S. Treasury, meanwhile, on Monday extended the sanctions waver on Russian oil for 30 days. Indian refiners have relied heavily on Russian crude oil amid the drought of deliveries from the Middle East.
In the U.S., the largest oil supply disruption in history continued to draw on inventories amid surging exports. Commercial crude oil stocks have over the past four weeks shrunken by more than 12.8 million bbl, and the strategic petroleum reserve fell 33.8 million bbl to its lowest level in nearly two years. Total oil and product inventories have been declining since late March and are expected to further decrease as domestic crude and fuel demand pick up the pace and international demand is set to remain high. The American Petroleum Institute's weekly inventory estimate is scheduled for release later Tuesday, followed by data from the U.S. Energy Information Administration on Wednesday.