Brent Oil Retreats as Trump Tweets, Sanctions Muddy Iran Policy - Bloomberg

Brent Oil Retreats as Trump Tweets, Sanctions Muddy Iran Policy - Bloomberg:

Oil investors delivered a split decision Monday that reflected the muddy outlook for the U.S.-Iran confrontation, with global benchmark Brent crude retreating while U.S. futures gained for the third straight day.

Brent closed down 0.5% while U.S. West Texas Intermediate crude added almost 1%. Days after abruptly aborting a strike on Iran, President Donald Trump in a tweet asked “why are we protecting" the Strait of Hormuz, the critical Persian Gulf waterway. Yet he also imposed new sanctions on Iran’s supreme leader, Ayatollah Ali Khamenei, and eight military commanders.

Brent fell in part due to traders downgrading the chances of an immediate confrontation, said Bill O’Grady, chief market strategist at Confluence Investment Management LLC in St. Louis. U.S. barrels, nonetheless, may look more attractive as tensions simmer, he said; government data last week also suggested U.S. demand is on the rise, O’Grady said.   

“Between higher exports and hopes for inventory contractions in the U.S., being long on WTI might make some sense," he said.

West Texas Intermediate for August delivery rose 47 cents, or 0.8%, to $57.90 a barrel at the close of official trading on the New York Mercantile Exchange. Brent for August settlement slipped 34 cents to $64.86 on London’s ICE Futures Europe Exchange.