The United States Oil Fund LP (USO) plummeted 6.28% during Tuesday's intraday trading session, reversing earlier gains as crude oil futures gave up ground.
The sharp decline followed reports that diplomatic efforts were underway to de-escalate tensions in the Middle East, specifically that Pakistan had urged Iran to reopen the strategically vital Strait of Hormuz. This development raised hopes for a potential resolution to the supply disruption that has supported oil prices, leading to a sell-off in crude futures and the related ETF.
Brent crude futures fell in post-settlement trading following the news, erasing earlier gains driven by geopolitical risks associated with the U.S.-Iran conflict and a looming deadline set by former President Trump.
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