Sell crude on Obama’s Syria shift: Pro

Tuesday, 10 Sep 2013 | 2:28 PM ET
Potential Syrian solution sinks crude
The possibility of a solution in Syria drives oil down, as President Obama agrees to U.N. talks. With CNBC's Jackie DeAngelis and the Futures Now Traders, Jim Iuorio and Jeff Kilburg at the CME.

Crude oil is sliding on Tuesday, as a U.S. military strike of Syria appears less likely. Russia has proposed that Syria hand over its chemical weapons stockpile, and President Barack Obama has agreed to a U.N. discussion of the proposal.

(Read more: Oil hammered as Syria strike odds fade)

The market is beginning to realize that Obama has an out. At this point, I don't believe there is much of a chance that we bomb Syria, and the market seems to agree with me. We have to remember that this administration ran on an anti-war platform. So does the president really want to go directly against public sentiment and enter into a third conflict? I believe the answer to that is no, and that the crude market will now begin to remove the Middle East premium.

President Barack Obama speaks about Syria from the Rose Garden at the White House in Washington, DC, on August 31, 2013.
Jim Watson | AFP | Getty Images
President Barack Obama speaks about Syria from the Rose Garden at the White House in Washington, DC, on August 31, 2013.

The thing is, if you put the Middle East aside, then the crude oil picture looks relatively bearish. The American fleet is becoming more efficient, and supplies are increasing.

(Read more: Strategic oil release talk mounts on Syria view)

So how am I trading oil now?

I am interested in selling October crude at $107, with an objective of $105.50. But I would set a stop at $107.80, just in case Syria heats up again.

Jim Iuorio is the managing director of TJM Institutional Services. Follow him on Twitter @JimIuorio.

Watch "Futures Now" Tuesdays and Thursdays at 1 p.m. EDT exclusively on FuturesNow.CNBC.com!

Like us on Facebook! Facebook.com/CNBCFuturesNow.

Follow us on Twitter! @CNBCFuturesNow.

  Price   Change %Change

Contact Futures Now

  • Showtimes

    Watch Futures Now Tuesdays & Thursdays 1p ET exclusively on cnbc.com!

Sponsor Links

  • CME Group brings buyers and sellers together through its CME Globex electronic trading platform and trading facilities in New York and Chicago.

  • Take your trading to the next level with a platform that lets you trade stocks, options, futures and forex all in one place with no platform or data with no trade minimums. Open an account with TD Ameritrade and get up to $600 cash.