Oil Rises as Iran Denies U.S. Talk Claims, Attacks Continue


   
Karim Bastati
DTN Analyst

   VIENNA (DTN) -- Oil prices advanced Tuesday (3/24) morning after Iran denied 
U.S. claims of negotiations and Israeli and Iranian attacks continued. Brent 
plunged 11% in the prior session on hopes of a diplomatic resolution to the 
U.S.-Israeli war on Iran spurred by U.S. President Donald Trump postponing 
strikes on Iranian energy infrastructure for a five-day period on alleged 
ongoing back-channel talks with senior Iranian officials.

   Senior Iranian leadership on Monday denied claims of talks with the U.S., 
saying the country will continue to defend itself against military aggression. 
Israeli Defense minister Israel Katz said Tuesday the country was continuing 
its attacks on Iran at full force. Iran overnight launched attacks on Israel 
and on U.S. bases in the Middle East. U.S. strikes also continued, as the 
five-day pause seemingly applied only to Iranian energy infrastructure.

   Meanwhile, thousands of U.S. troops were set to arrive in the region just as 
Trump's 48-hour ultimatum expired today. The President and senior White House 
officials have in the past openly mulled to occupy Kharg Island, home to vast 
oil storage and terminals, and the vital conduit for currently 90% of Iranian 
oil exports. U.S. forces struck more than 90 military installations on the 
island in an attack ten days ago.

   Tanker traffic through Strait of Hormuz has been at a trickle for the last 
three weeks. More than 20 million bpd of petroleum liquids transited the 
chokepoint before the war. While Saudi Arabia and the United Arab Emirates were 
able to reroute some crude exports to ports in the Red Sea and the Gulf of 
Oman, up to 10 million bpd of crude oil and virtually all product exports from 
the Persian Gulf remained shut in.

   Near 08:00am ET, WTI for May delivery was up $2.78 to $90.91 bbl, and Brent 
for May delivery advanced $2.34 to $102.28 bbl.

   ULSD futures for April delivery rose 4%, or $0.1651, to $4.2211 gallon, and 
front-month RBOB futures added $0.1095 to $3.0844 gallon.

   The US dollar index strengthened by 0.365 points to 99.09 against a basket 
of foreign currencies.




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