By Srinivas Chowdary Sunkara // petrobazaar // 8-5-2018
U.S oil dropped on Trump tweet
Yesterday, Oil markets ignored Friday's news of increased rig numbers for the fifth week in a row and continued to follow Geo-politics and traded at higher levels after Nov, 2014. The deteriorating economic situation in Venezuela continued to affect oil production, supported Brent and WTI fall more than 1% after U.S president, Trump tweet of promising an early decision on Iran deal. Russians continued to miss the compliance target rate in April and many of the OPEC members did slightly below the target of 32.5 Mbpd.
Trump tweet - Investor perspective - analysis
Analysts are in the opinion that market probably considered from his comments that U.S stays in the deal. That would tweak it and not totally leave the deal. Vert recently, U.S president worried about high oil prices and strongly criticized OPEC on high oil prices. Killing the deal may inflict more pain on motorists, as it may lead to sanctions placed on Iran and their oil production, which would likely push oil prices higher. Higher or even higher gasoline prices ahead of U.S midterm elections this year could be a factor in leading the U.S president to reconsider calling off the Iran deal said an analyst.
Crude oil price update
Yesterday, U.S oil for June delivery dropped more than $1 after trump tweet and the decline claimed most of the gains for Monday. Today, WTI is trading down with above 1 % at $69.9 a barrel on Nymex.
Brent for July settlement jumped by $1.3 or 1.7% to close at $76.17 a barrel yesterday and lost around 1% today to trade at $75.38 per barrel on London based ICE futures Europe exchange.
There is a fundamental shift in the market for last couple of days. very significant changes are happening from Geo-politics, considered Iran deal as a key factor. U.S dollar is trading higher and the dollar index is steady against basket of six major currencies. Though U.S production surges, Market is looking at U.S decision on Iran for direction.
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