Crude prices declined as Saudi Arabia moves to restore flows on a vital pipeline, while traders weighed the trajectory of the US-Iran conflict and developments surrounding a potential reopening of the Strait of Hormuz. Brent crude slipped 1.1%, settling near $99 per barrel.
Saudi Arabia is in the early stages of restarting its East-West pipeline, which was knocked offline by a drone strike earlier this month. The kingdom aims to resume exports through that route later this week, offering some relief to a market that has faced acute supply tightness over the past several weeks. Although millions of barrels still transit the Strait of Hormuz daily, volumes remain below pre-conflict levels.
On the diplomatic front, world leaders have gathered in New York for the UN General Assembly, where the course of the Iran conflict is expected to be a central topic. US President Donald Trump said a government official held talks with an Iranian delegation that lasted three hours, describing the discussions as “going very well.” That partially countered earlier hardline rhetoric, after Trump threatened to destroy Iran during his UN address and the Iranian delegation walked out.
Trump also said he has urged his advisers to approve a ban on fuel exports, a measure that lawmakers from diesel-dependent states have also pushed for in recent days. The goal is to ease surging fuel prices at a time when major Middle Eastern refineries are running at reduced rates and Ukraine continues to strike Russian energy infrastructure. Several oil and gas industry executives have cautioned against the controversial move.
Crude has climbed more than 65% this year as Middle East disruptions roil the world’s most critical energy chokepoint, with fuel markets seeing even larger gains. “Hormuz traffic staying elevated suggests Iran’s leverage has weakened, meaning Tehran may be more willing to strike a deal than before, but it also raises the possibility of escalation to reassert control,” said Ryan McKay, senior commodity strategist at TD Securities.
Brent futures for November settled 1.1% lower at $99.25 per barrel. WTI futures fell 1.2%, settling at $94.59 per barrel.