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Oil slides; early rally quashed by Iran speculation

A derrick hand for Raven Drilling, works on an oil rig drilling into the Bakken shale formation outside Watford City, N.D.
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A derrick hand for Raven Drilling, works on an oil rig drilling into the Bakken shale formation outside Watford City, N.D.

Oil fell on Tuesday, with U.S. crude settling near $105 as Iran's new president signaled willingness to negotiate with the West over Tehran's disputed nuclear program, and as U.S. gasoline prices slid after a sell-off in ethanol credits.

Iran's newly elected President Hassan Rouhani said he was ready to enter "serious and substantive" negotiations, reducing the geopolitical risk premium for oil prices. The price of U.S. gasoline fell 1.25 percent, dragged by a sell-off in ethanol credits U.S. refiners must purchase to comply with environmental regulations.

Brent crude was down nearly one percent at under $108 a barrel. U.S. light, sweet crude settled down $1.26 at $105.30.

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