Oil prices declined on Tuesday in Asia, stepping back from the 3-and-a-half-year peak as traders awaited US President Donald Trump’s decision on whether to impose renewed sanctions on Iran.
Crude oil from WTI futures for delivery in June traded at $69.97 per barrel, or 1.07 percent lower. Brent Oil Futures for delivery in July was 0.89 percent lower, trading at $75.49 per barrel.
This came after the prices rose higher than $70 per barrel for the first time since November 2014, amid looming concerns over possible Iran sanctions that threatened to disrupt supplies of oil.
Oil prices have stayed near the edge since Iran assumed an aggressive stance in its response to the United States over a 2015 nuclear deal, which is set to expire on the 12th of May.
Trump said that a decision on whether the US will impose sanctions on Iran or retain the Iran nuclear deal will be announced today, four days earlier than previously expected.
In the event that Trump doesn’t renew a waiver on sanctions, Iranian oil sales will be hugely lowered within 6 months. Sanctions will probably tighten global supplies since Iran is the third largest oil producer in the Organization of the Petroleum Exporting Countries (OPEC).
Iran’s exports will potentially be cut by 200,000 to 300,000 barrels per day as a result of any such sanctions. In April, Iran’s exports reached 2.6 million barrels per day, with India and China purchasing more than 50 percent of Iran’s oil.
Should Trump renew US sanctions on Iran, he will have to wait at least 180 days before he could impose the furthest-reaching measure, which is targeting the banks of countries that do not significantly cut their purchases of Iranian oil.
On the other hand, Iranian officials said that the country’s oil industry would still continue to develop even if the United States moves out of the nuclear deal.
Gold Prices Decline of Strong Dollar
Gold prices slipped on Tuesday as the dollar steadied prior to the release of the PPI and CPI data set on Wednesday.
Gold futures for delivery in June on the Comex division in the New York Mercantile Exchange slumped $2.3, or 0.2 percent, to $1,311.80 per troy ounce.
The US Dollar Index, which gauges the greenback’s strength against a basket of other major currencies, gained 0.05 percent to 92.66. The dollar reached its highest level this year at 92.82.
As for other precious metals, silver futures dropped 0.12 percent to $16.475 per troy ounce, while platinum futures lost 0.18 percent to $910.40 per troy ounce.