Crude oil prices dropped more than $2.45 a barrel Tuesday, as President Trump said progress has been made with Iran, signaling tensions could ease in the Mideast, Kallanish Energy reports.
Brent crude futures dropped $2.56, or 3.7%, to $63.86/Bbl, after hitting a session high of $67.09/Bbl. And West Texas Intermediate crude futures fell $2.46, or 4.2%, to $57.09/Bbl. The U.S. benchmark hit a session high of $60.06/Bbl earlier in the day.
Trump said Tuesday a lot of progress had been made with Iran and he wasn’t looking for a regime change in the country.
Trump, who made the remarks at a Cabinet meeting in the White House, did not give details about the progress, but U.S. Secretary of State Mike Pompeo said at the meeting Iran had said it was prepared to negotiate about its missile program.
Tension between the U.S. and Iran over Tehran’s nuclear program have previously given support to oil futures prices, given the potential for a price spike should the situation deteriorate.
Uncertainty about China’s economic prospects also pressured prices lower after data on Monday showed growth in the country slowed to 6.2% from a year earlier — the weakest pace in at least 27 years.
Additionally, U.S. oil companies on Monday began restoring some of the nearly 74% of Gulf of Mexico production shut-in because of Hurricane/Tropical Storm Barry.
Workers were returning to the more than 280 production platforms that had been evacuated. It can take several days for full production to resume.
However, some say the bullish inventory data is structural, and not attributable only to the storm.
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