President Trump said he wouldn’t stop China from purchasing oil from Iran, signaling he might ease the U.S.’s “maximum pressure” campaign on Tehran. “They’re in the oil business. I mean, I could stop it if I wanted,

President Donald Trump said on Tuesday that China can continue to purchase Iranian oil after Israel and Iran agreed to a ceasefire, a move that the White House clarified did not indicate a relaxation of U.

Oil extended a slump as President Donald Trump announced a tentative ceasefire between Iran and Israel. Stephen Stapczynski reports on Bloomberg Television. (Source: Bloomberg)

That’s because the correlation between crude oil and stocks has not been stable over time. For several decades prior to 2000, for example, that correlation was negative, as you can see in the chart below. During those decades, higher oil prices in a given month led to below-average stock-market returns in the subsequent month.

The U.S. crude oil price benchmark, West Texas Intermediate, fell 8% to less than $68 a barrel, the lowest level since last week. The global Brent crude price benchmark likewise fell about 8%. Major stock indexes ended the day in positive territory.