Crude Falls as China Threatens Retaliation Over Iran Sanctions

Crude fell 2.05 yesterday after the Treasury's sanctions on Iran came in lighter than expected and lacked detail. The bigger story is the threat of secondary sanctions on any country still trading with or supporting Iran, an implicit shot at China given how much cheap Iranian oil it imports. China responded overnight by threatening retaliation and saying it won't back away from cooperating with Iran, and futures are extending losses this morning, down 3.08. Dan sees the pullback toward the 81.34-81.00 support zone, which lines up with the 20-day moving average near 81.03, as a decent buying opportunity, with 80.34 as the next level down if that doesn't hold. He remains bullish longer-term but flags that election-year price pressure and seasonal weakness could cap any near-term upside.USA and China Trade Relations by rawf8 via Shutterstock