Oil prices slip from 3-year high as traders wait for Trump move on Iran
Oil prices declined on Friday, stepping back from three-year highs as traders awaited the Trump administration’s decision on whether to extend temporary waivers on sanctions against Iran.
West Texas Intermediate oil for February delivery CLG8, -0.50% lost 35 cents, or 0.6%, to $63.45, while Brent for March LCOH8, -0.19% fell 13 cents, or 0.2%, to $69.15.
The declines come after both contracts ended at their highest level since December 2014 on Thursday, after data earlier in the week showed U.S. stockpiles continued to shrink. During Thursday’s session, Brent traded above the psychologically important $70 level.
“The market is trading lower in a technical response to the failure in breaking above $70 in Brent. This psychological level also halted Brent’s advance in 2015,” said Ole Hansen, head of commodity strategy at Saxo Bank, in emailed comments.
“President Trump has yet to make a statement on Iran. Ahead of this statement the downside risk from here remains limited given the potential bullish impact should he step away from the nuclear deal,” he added.
U.S. President Donald Trump is facing a deadline on Friday on whether to waive or reimpose sanctions on Iran this week, a decision that has implications on Iran’s oil exports. If sanctions are reimposed, it could limit Iran’s oil exports and further help reduce the global supply glut that has kept a lid on prices in recent years. However, if Trump keeps the waiver in place, Iran will be able to continue to sell oil on the global energy markets.
Reuters reported early Friday that Trump, who has vowed to scrap the pact, will extend the sanctions relief, but would give the U.S. Congress and European allies a deadline to approve the accord.
Later on Friday, the weekly Baker Hughes BHGE, +2.90% rig count data are likely to grab attention.
In other energy products on Friday, gasoline RBG8, -0.32% fell 0.2 to $1.83 a gallon, while heating oil HOG8, -0.01% was flat at $2.08 a gallon.
Natural gas NGG18, +0.52% jumped 0.8% to $3.11 per million British thermal units.
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