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Trump signaled that tensions with Iran were easing, reducing fears of a wider conflict. Crude prices reversed sharply from an initial spike caused by Iran's missile strike on bases in Iraq housing U.S. troops.
Reduced conflict fears remove the supply-risk premium from crude, pulling energy prices lower. Lower fuel and freight costs can modestly ease feed production expenses.
cnn.comMatt Egan, Laura He, Charles RileyJan 8, 2020After 255 past bearish geopolitics events, Crude Oil (WTI) moved a median -2.4% over 5 sessions (31% higher; middle half -7.0% to +1.7%), and -5.0% over 20.
After 250 past bearish geopolitics events, Crude Oil (Brent) moved a median -3.1% over 5 sessions (36% higher; middle half -7.9% to +1.6%), and -5.5% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
