WTI at $87 Embeds a $15 War Premium With Iran Ceasefire Odds at 30%

Prior was -3327K Gasoline +3364K vs -513K expected Distillates +1502K vs -319K expected Refinery utilization +0.2% vs +0.3% expected API data released late yesterday: Crude -6750K Gasoline -3199K Distillates -214K WTI crude oil was up $1.10 to $94.92 ahead of the report. This article was written by Adam Button at investinglive.com.

Headlines: US president Trump reaffirms that Iran has agreed to not have a nuclear weapon Iran reserves right to defend against any country permitting US attacks EU says latest US tariffs on forced labour grounds are unjustified USD/JPY continues to poke and prod at intervention strike zone BOJ governor Ueda says will continue to raise policy rate if baseline outlook holds ECB policymaker Elderson says prolonged war increases likelihood of second-round effects SNB Chairman Schlegel says medium-term inflation pressure is basically unchanged Eurozone business activity struggles further in May amid surging price pressures UK May final services PMI 49.3 vs 47.9 prelim How likely is a U.S. debt crisis? Markets: WTI crude up 2% to $95.70 European indices lower, DAX down 0.9% while CAC 40 down 0.4% S&P 500 futures down 0.1% USD a little higher, USD/JPY volatility swings after nearing 160 US 10-year yields up 2.8 bps to 4.48% Gold down 0.5% to $4,463 It was a more pensive session as we continue to wait on whether or not the US and Iran will strike a deal this week. But by the look of things, it seems that both sides are still finding it hard to meet in the middle especially on key terms. US president Trump came out to reaffirm that Iran has agreed to not have a nuclear weapon. But as a reminder, this notion of a baseline promise was denied by Tehran previously last week already. Besides that, he also said that the US naval blockade may stay the course until Labour Day. If so, that means it will be another three more months of this with the naval blockade being lifted supposed to be a key condition for Iran in this framework agreement. So, make what you will of that. Markets remain unfazed for the most part despite the mix of headlines. However, oil prices are continuing to push up with WTI crude up 2% to $95.70 on the day. In the equities space, we are seeing a more tepid mood with European indices falling off while US futures are sitting marginally lower on the day. Ge

WTI crude futures have risen nearly 10% in three days as hopes for a quick peace deal fade.

Sree Kochugovindan, Senior Research Economist at Aberdeen Investments, focusing on current market sentiment. The recent decline in Brent crude prices, which dropped by 0.72% to $94.30 per barrel. The segment aims to provide insights into the factors influencing investor confidence and market dynamics in the Middle East and Africa region. (Source: Bloomberg)

There have been various reports about whether the US and Iran are talking. Now Rubio says that talks are continuing. Another notable line from him is that "there is a prospect that Iran has agreed to negotiate aspects of nuclear program that they previously refused to mention in discussions". So that's potentially positive. WTI crude oil is down 25 cents to $91.91 but is up from the session low of $90.12. This article was written by Adam Button at investinglive.com.

West Texas Intermediate and Brent crude’s front-month contracts both edged lower after hitting monthly highs during Monday’s session.

The main talk of the town yesterday was US president Trump looking to broker a ceasefire between Israel and Lebanon. He confirmed that by saying that "all shooting will stop", allowing for the US to at least try and negotiate with Iran again on a broader framework agreement. As mentioned before, the Israel-Hezbollah ceasefire is a key precondition that Iran wants as part of the terms for the memorandum of understanding. However, the key question here is whether Israel will abide by that ceasefire. And as we have seen from a few hours ago here, it may not really be the case. If it cannot last a day, how is it expected to carry through for the next 60 days when the US-Iran deal is finalised? As a reminder, these are the other key terms that need to be agreed upon. Otherwise, the whole deal/memorandum of understanding may fall apart at any time once signed. For now, markets are still waiting on the US and Iran to strike a compromise on all fronts. Then, we'll see how things go with nuclear discussions. But as the wait continues, market players are pretty much being put on edge in the meantime. After pushing up yesterday, US futures are now pointing lower with S&P 500 futures down 0.4% on the day. Tech shares are leading declines with Nasdaq futures down 0.6%. The overnight comments by OpenAI CEO, Sam Altman here are perhaps worth looking over if anything else. Besides that, oil prices also posted its best daily showing since late April yesterday with WTI crude nearly touching $95. That fizzled late on and we're seeing a slight pullback now with prices down 1% to $91.20 on the day. In other markets, the US dollar continues to remain little changed in the major currencies space. There's no real conviction here as traders continue to wait on US-Iran developments before really committing to any moves. That being said, USD/JPY continues to hold at 159.70 and nearby intervention strike range so that is one to keep an eye out for. Besides that, bond yields are also being push