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Oil jumps 5% on Iran tension, potential US Federal Reserve rate cut

The security premium built into oil prices could rise further as tensions between the US and Iran heat up

Jessica Resnick-Ault | Reuters  |  New York 

Oil soared more than 5% on Thursday after Iran shot down a US military drone, raising fears of a military confrontation between Tehran and Washington. Expectations that the US Federal Reserve could cut interest rates at its next meeting, stimulating growth in the world’s largest oil-consuming country, and a drop in US. crude inventories also supported prices. “It’s a confluence of events: there’s a looming easing cycle which is going to hit the dollar and prop up commodity prices and there are also the tensions with Iran,” said John Kilduff, a partner ...

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First Published: Fri, June 21 2019. 03:04 IST