Oil prices are sliding this morning following as anover-supplied market(API reported a huge 11.4mm barrel build last week) beats thegeopolitical risk premia(with the US poised to attack Iran).
"Iran, rather than backing down and agreeing to all and any term [U.S. President Trump] is placing on the table (as he had expected), is instead daring him to attack.
"Just you try it and you will see what you will get!" is kind of what Iran implicitly said to Trump when it held military drills in the Straight of Hormuz last week," Bjarne Schieldrop, chief commodities analyst at SEB Research, wrote.
But, prices dipped into negative territory after a Hezbollah official said the group will not intervene in the event of limited US strikes on Iran, AFP reported.
“My preference is to solve this problem through diplomacy, but one thing is certain: I will never allow the world’s number one sponsor of terror, which they are by far, to have a nuclear weapon,” Trump said on Tuesday.
Nevertheless, The US has ordered the biggest military build-up in the Middle East since the second Gulf war in 2003, including two aircraft carriers. America is adding even more assets to the region, deploying 12 stealth F-22 fighter jets to Israel, according to CNN, which cited a defense official.
“So long as we remain in this realm of uncertainty, oil prices are more prone to upside risk on any headlines out of the US-Iran talks,”said Samantha Hartke, head of market analysis for the Americas at Vortexa Ltd.
“Our view is that a prolonged disruption is unlikely given the onerous effect that will have on Iranian trade flows and revenues,” she added, referring to Hormuz.
So will the official data confirm API's ugly over-supplied build signal?
Crude +15.99mm - biggest build since Feb 2023
Source: ZeroHedge News
