UPDATE 10-Oil falls as Iran tensions seen easing

* Gulf of Mexico output coming back online after storm
* Coming Up: API's U.S. inventory data 4:30 p.m. EDT (2030
GMT)

(Updates with settlement prices)
By Jessica Resnick-Ault
NEW YORK, July 16 (Reuters) - Oil prices turned lower on
Tuesday, falling more than 3% after U.S. President Donald Trump
said progress has been made with Iran, signaling tensions could
ease in the Mideast.
Brent crude futures LCOc1 fell $2.13 a barrel, or 3.2%, to
settle at $64.35. The international benchmark hit a session high
of $67.09 earlier in the day.
West Texas Intermediate crude futures CLc1 settled at
$57.62 a barrel, down $1.96, or 3.3%. The U.S. benchmark hit a
session high of $60.06 early in the trading day.
"What were tailwinds have become headwinds," said Bob
Yawger, director of energy futures at Mizuho in New York. He
said the same U.S.-Iran tensions that had driven prices higher
earlier in the session put a damper on the market after Trump's
comments.
Trump on Tuesday said a lot of progress had been made with
Iran and that he was not looking for regime change in the
country. Trump, who made the remarks at a Cabinet meeting in the
White House, did not give details about the progress, but U.S.
Secretary of State Mike Pompeo said at the meeting Iran had said
it was prepared to negotiate about its missile program.
Tensions between the United States and Iran over Tehran's
nuclear program have previously lent support to oil futures,
given the potential for a price spike should the situation
deteriorate.
Uncertainty about China's economic prospects also pressured
prices lower after data on Monday showed growth in the country
had slowed to 6.2% from a year earlier, the weakest pace in at
least 27 years.
Additionally, U.S. oil companies on Monday began restoring
some of the nearly 74% of production that was shut at platforms
in the Gulf of Mexico because of Hurricane Barry. Workers were returning to the more than 280 production
platforms that had been evacuated. It can take several days for
full production to resume.
The storm will probably result in a noticeable decline in
U.S. crude oil stocks this week, analysts at Commerzbank said.
Inventory data will be published by the American Petroleum
Institute on Tuesday evening, and by the U.S. Department of
Energy on Wednesday.
Some say bullish inventory data is structural, and not
attributable only to the storm.
"Beyond the storm we feel we're in a tightening inventory
mode through August," said Phil Flynn, an analyst with Price
Futures Group in Chicago.

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U.S. Oil drilling and storage png https://tmsnrt.rs/2Ino7XU
TECHNICALS-U.S. oil may fall to $58.32 L4N24H0MZ
TECHNICALS-Brent oil may test support at $66.09 ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>