No clear direction for crude oil prices ahead of the start of U.S. trading on Tuesday as markets balance geopolitical tensions against global trade concerns. File Photo by Monika Graff/UPI | License Photo
July 24 (UPI) -- Crude oil prices were in mixed territory ahead of the start of U.S. trading on Tuesday as Middle East tensions balanced against global trade risks.
Crude oil prices settled down on Monday after a weekend of escalating barbs between U.S. and Iranian leaders. After an initial spike of about 1 percent for the price for Brent crude oil, markets cooled off on expectations the U.S. government may actually offer some Iranian oil clients relief from sanctions that go into force in November.
The looming loss of Iranian oil barrels may already be factored in. Members of the Organization of Petroleum Exporting Countries in June, meanwhile, implied that more oil may be on the market in the second half of the year.
Production from Iraq, the second-largest OPEC producer behind Saudi Arabia, is setting records.
Tensions in the Middle East escalated on Tuesday, however. Through its Twitter account, Israeli Defense Forces said Syrian targets were struck amid border violations.
"Two Patriot missiles were launched at a Syrian Sukhoi fighter jet that infiltrated about 1 mile into Israeli airspace," its statement read. "The IDF monitored the fighter jet, which was then intercepted by the Patriot missiles."
The price for Brent crude oil, the global benchmark, was down 0.21 percent as of 9:18 a.m. EDT to $72.91 per barrel. West Texas Intermediate, the U.S. benchmark for the price of oil, was up 0.04 percent to $67.92 per barrel.
Investors may be waiting for data on U.S. crude oil inventories before making big moves. The U.S. Energy Information Administration last week reported a build in U.S. storage, sending prices lower on the indication that supply-side fears were fading.
Broader markets may be under pressure on growing concerns about global trade policy. U.S. President Donald Trump meets Wednesday with European Commission President Jean-Claude Juncker to discuss trade policies seen as unfavorable by some leaders in the European Union.
On Twitter, the U.S. president declared that tariffs provided leverage.
"Either a country which has treated the United States unfairly on trade negotiates a fair deal, or it gets hit with tariffs," he stated. "It's as simple as that."
International Monetary Fund Managing Director Christine Lagarde said during the weekend that global trade tensions could create risks for the global economy, especially in the short term.