DTN Oil Update
Oil Retreats After Spiking on Escalating Mideast Tensions
VIENNA (DTN) -- Oil futures retreated Thursday morning after surging to a two-month high Wednesday. The largest daily gain in oil prices since October came on the back of rumors of both potential Israeli strikes on Iranian nuclear facilities and Iranian strikes on U.S. bases in the region. Fears were fueled by reports of U.S. diplomatic staff being evacuated from several Middle Eastern countries, and Iran's Defense Minister threatening strikes on U.S. bases should nuclear talks fall through.
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NYMEX-traded WTI for July delivery was down $1.02 bbl to trade near $67.13 bbl, and ICE Brent for August delivery fell $1.01 bbl to $68.76 bbl.
July RBOB gasoline futures dropped by $0.0336 to $2.1332 gallon, and the front-month ULSD futures contract shed $0.0260 to trade near $2.1793 gallon.
The U.S. Dollar Index declined by 0.969 points to a three-year low of 97.635.
The evacuations came the day after U.S. President Trump uttered fresh skepticism overreaching an agreement with Iran in ongoing nuclear talks, easing oversupply concerns which were fueled by slowed demand growth and OPEC ramping up production. Representatives from the United States and Iran are scheduled to meet Sunday in Oman for a sixth round of negotiations.
Wednesday's gains were also the result of renewed trade optimism in the face of a U.S.-China trade deal announcement. The President's comments about planning to unilaterally impose "take it or leave it" tariffs on trade partners over the coming two weeks, however, blunted de-escalation hopes and contributed to the retreat Thursday morning.