Oil Prices Plummet After Trump's Iran War Remarks

Oil prices saw a wild reversal on Monday after US President Donald Trump's remarks suggesting that the Iran war could end soon. Crude had surged earlier in the day due to supply fears, but then plummeted as traders reacted to talk of strategic reserve releases and Trump's comments.

The United States Oil Fund (USO) ETF dropped more than 4%, while shares of Battalion Oil Corporation (BATL) fell about 16% and Trio Petroleum (TPET) declined roughly 12%. Economist Peter Schiff attributed the reversal to profit-taking tied to talk of reserve releases and Trump's comments.

Analysts, however, remain bullish on the oil rally. Former JPMorgan strategist Marko Kolanovic noted that much of the selling appeared driven by systematic trading strategies hitting stop-loss levels after the rapid rally. He said the oil trend remains positive and that commodity trading advisors could re-establish long positions if geopolitical risks persist.

Patrick De Haan, a petroleum analyst at GasBuddy, stated that U.S. diesel prices have climbed to about $4.73 per gallon and gasoline to roughly $3.53 per gallon. However, if crude continues to trade below the recent spike levels, gasoline prices could stabilize or even start easing by the end of the week.