Global oil prices fell on Tuesday for the first time in nearly a week, as the prospect of increased Russian diesel supplies eased concerns over tight energy markets, despite continued threats to oil infrastructure and shipping routes in the Middle East.
Brent crude futures fell $1.30, or 1.2%, to $105.35 a barrel by 0329 GMT. US West Texas Intermediate (WTI) crude futures dropped $1.25, or 1.3%, to $92.49 a barrel. Both benchmarks had risen by nearly $2 in the previous trading session, with Brent settling at its highest level since September 15.
US President Donald Trump said Russia had agreed to supply additional diesel to global markets. His administration temporarily lifted US sanctions on Russian energy supplies as part of efforts to reduce Moscow’s revenues from its war in Ukraine.
The potential increase in supplies could ease pressure on global energy markets, which have recently been supported by concerns over limited crude availability.
However, analysts at ING expressed doubts about the prospects for a Russia-Ukraine energy truce, citing reports that Russia had attacked Ukrainian energy targets following Trump’s announcement.
Meanwhile, concerns over energy infrastructure and shipping security in the Gulf remained elevated after Iran-aligned Houthi forces reportedly attacked Riyadh’s international airport over the weekend. Reports of attacks on tankers near the Strait of Hormuz have also heightened fears of further disruptions along one of the world’s most critical oil transit routes.
These developments could undermine the recovery in Middle Eastern oil supplies seen in September and intensify uncertainty over global energy shipments.
Tim Waterer, chief market analyst at KCM Trade, said the prospect of additional Russian diesel supplies and some stabilisation in Saudi oil flows had provided limited relief to the market.
However, he noted that traders remained more concerned about the risk of further attacks on ships and pipelines in the Gulf than reassured by the prospect of additional supplies.
COMMENTS