2 Mutual Funds To Gain From Oil's Recent Slump

Oil futures moved south on Sep 11, stooping to their lowest in about a week, on reports that President Trump is considering easing sanctions on Iran. Oil prices slumped on the possibility that Iran’s crude might join the global oil market again.

Therefore, it’s ideal to invest in a couple of mutual funds that invest in companies that could benefit from low oil prices.

Trump Could Ease Sanctions on Iran

Tensions between the United States and Iran are not new. Earlier this year, repeated attacks on oil tankers and an unmanned U.S. drone near the Strait of Hormuz led to tensions between the two countries. The Strait of Hormuz accounts for approximately a third of the world’s oil traffic via sea.

The United States alleged that Iran had carried out these attacks. However, Iran had denied the attacks on oil tankers and had firmly said that the U.S. drone was in Iranian airspace. Following this, Trump imposed “hard-hitting” sanctions on the Middle Eastern country.

The sanctions denied Iran’s Supreme Leader Ayatollah Ali Khamenei and his office access to crucial financial resources. Moreover, sanctions were imposed on military leaders responsible for shooting the unmanned U.S. drone down.

These sanctions were in addition to a set of previous sanctions that restricted Iran’s oil industry and other key sectors. Since oil plays a vital role in Iran’s economy, crippling its oil industry proved to be a serious setback for the country’s economy.

However, with the recent development of Trump firing National Security Advisor John Bolton earlier this week, who strongly backed putting pressure on Iran, chances of a military conflict between the two countries have decreased significantly.

What’s more, Trump could consider easing sanctions on the Islamic country as well in a bid to secure a deal. There are also chances of Trump meeting Iran’s president Hassan Rouhani later this month in New York during the annual United Nations General Assembly.

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