By Jesse Cohen
Investing.com - Oil prices held near their strongest level in three weeks on Tuesday, as tensions between Washington and Tehran remained high.
U.S. WTI crude futures were at $57.59 by 6:15AM ET (10:15GMT), within sight of a three-week peak of $58.22 scaled on Monday.
Brent crude futures traded at $63.75 per barrel, not far from Monday's three-week high of $65.79.
U.S. crude surged about 9% last week, while Brent tacked on 5%, after Iran shot down an unmanned U.S. surveillance drone in the Gulf, adding to tensions stoked by attacks on oil tankers in the area in May and June.
Washington has blamed the tanker attacks on Iran, which denies having any role.
U.S. President Donald Trump targeted Iran’s Supreme Leader Ayatollah Ali Khamenei and other top officials with sanctions on Monday, taking a dramatic, unprecedented step to increase pressure on the Islamic Republic.
Washington said it would also impose sanctions on Iran’s Foreign Minister Javad Zarif later this week.
Tehran responded by saying that the “useless sanctions” imply the “permanent closure of the path of diplomacy” between the countries.
While diplomatic tensions remain high, some said the threat of immediate military conflict had eased slightly, as Trump has opted to go down the sanctions road for now.
The U.S. president late last week called off a retaliatory air strike minutes before impact, which would have been the first time the U.S. had bombed Iran in decades of hostility between them.
Trump said he decided at the last minute that too many people would die.
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-- Reuters contributed to this report