Oil Extends Losses on US-Iran Diplomacy Hopes

Crude oil fell below $95.5 a barrel on Monday, extending losses for a fourth session after US President Trump reportedly decided against bombing Yemen for now and indicated he was open to diplomacy with Iran. Trump reportedly rejected calls from Saudi Arabia to strike the Houthis and said he would probably be open to meeting Iranian President Masoud Pezeshkian during this week’s UN General Assembly in New York. Meanwhile, crude exports from the Middle East have proven resilient even after Saudi Arabia closed its East-West pipeline following attacks. Saudi Arabia moved crude through the Strait of Hormuz at 2.9 million barrels a day over the past six days. Satellite images showed supertankers with capacity for 14 million barrels at Saudi Arabia’s Gulf export terminals over the weekend, the highest tanker count observed since at least June. Overall, however, traffic through the Strait of Hormuz continued to decline.

Crude oil fell to around $95.5 a barrel on Monday, extending losses for a fourth session as traders focused on diplomatic efforts to de-escalate the US-Iran conflict and signs that oil and LNG shipments through the Strait of Hormuz remain resilient. President Donald Trump said he would probably be open to meeting Iranian President Masoud Pezeshkian during this week’s UN General Assembly in New York. Trump may also meet with other Persian Gulf leaders, while he is scheduled to hold a summit with Chinese President Xi Jinping. Meanwhile, US Central Command chief Admiral Brad Cooper said crude and LNG flows through Hormuz have reached a six-month high, with the main transit lanes clear of mines. Middle East oil flows averaged 17.1 million barrels per day over the past 10 days, despite Saudi Arabia’s East-West pipeline remaining disrupted after recent attacks.

Crude oil dropped below $98 per barrel on Monday, declining for the fourth straight session, pressured by hopes that increased diplomatic efforts could help end the Middle East conflict and restore energy flows from the region. President Donald Trump said he would “probably” be open to meeting Iranian President Masoud Pezeshkian on the sidelines of the United Nations General Assembly in New York this week. Trump may also meet with other Persian Gulf leaders, while he is scheduled to hold a summit with Chinese President Xi Jinping. Qatari Prime Minister Sheikh Mohammed bin Abdulrahman Al-Thani urged Gulf states to cooperate in restoring stability across the region, noting that messages were being exchanged between the US and Iran. Meanwhile, US Central Command chief Admiral Brad Cooper said oil and liquefied natural gas shipments through the Strait of Hormuz over the past two weeks had reached their highest level in six months.