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Commodities: Energy futures drop ahead of White House announcement on Iran
Commodities were on the back foot on Tuesday as the Greenback climbed higher and traders took profits after a recent run-up in crude futures ahead of the White House's decision on the Iran nuclear deal due later in the session.
To take note of, earlier CNN had reported that as things stood even if the US stepped out of the Joint Comprehensive Plan of Action on Iran's nuclear programme, it would still take months to thrash out the details of any new sanctions, leaving room for negotiations to take place.
That report appeared to trigger selling in West Texas Intermediate crude oil futures, with the contract for next month delivery shedding 2.67% to stand at $68.84 per barrel as of 1849 BST, in what traders at Sucden Financial described as a nervous and jumpy market.
In parallel, the US dollar spot index was higher by 0.33% at 93.05, trading off an intraday high of 93.28, while the Bloomberg commodity index was lower by 0.49% to 89.39.
Contributing to the US dollar's advance, in an interview with Bloomberg TV, JP Morgan chief Jamie Dimon said investors would do well to prepare for 10-year Treasury yields at 4.0%.
The June gold contract on COMEX was also lower but only just, slipping 0.05% to $1,313.50/oz., possibly due to the scope for heightened tensions in the Middle East and what with the yellow metal's 200-day moving average to be found just beneath the current level of prices.
Among industrial metals, three-month LME copper finished lower at $6,745 per metric tonne, down from $6,826 at the Friday close.
Aluminium was the exception, buoyed by lingering concerns around Rusal.
"Encouraging Chinese trade data released this morning gave LME metals a boost in early trading with all contracts making gains. However, as the USD continued to strengthen and with a lack of momentum to drive the move, a gradual retreat to lower levels followed, with recent trading ranges intact," said Sucden.
Agricultural futures on the other hand were mostly higher, with ICE-traded cocoa futures the main exception, with the July contract erasing 2.63% to change hands at $2,773.00 per metric tonne.