Concerns about the extent of supply disruptions in the Middle East were allayed on Wednesday as Saudi Arabia offered more oil shipments for Asian clients through Oman. According to Reuters, US West Texas Intermediate (WTI) crude slid $1.96, or 1.85%, to $103.87 by 1307 GMT, while Brent crude futures fell $1.30, or 1.2%, to $107.45 per barrel. Following rumors that Saudi Arabia had halted petroleum loadings at its Red Sea export hub of Yanbu and canceled some shipments to European clients, oil prices rose by more than $3 during the previous session. According to persons acquainted with the situation, Saudi Arabia is currently providing more crude loadings to Asian refiners via ship-to-ship transfers off Oman’s Sohar port Reuters.
Shipping over the Strait of Hormuz was nevertheless drastically decreased. According to preliminary data, Tuesday saw just four vessels transit through the waterway, compared to an average of eighteen over a ten-day period.
Analysts are still keeping an eye on the effects of decreased traffic on the supply of oil and refined products over the Strait of Hormuz, a significant global energy corridor.
Diesel Supply Is Still Limited
Diesel markets continued to be under pressure even as crude prices decreased.
Due to limited gasoline supplies brought on by interruptions in Middle Eastern exports and restrictions on Russian fuel imports, European gasoil futures hit a record high on Tuesday before declining on Wednesday.
According to Reuters, which cited the Vedomosti daily, Russia plans to prolong curbs on diesel exports by fuel manufacturers until the end of October.
In the US,the national average diesel price has also risen above $6 a gallon for the first time.
According to LSEG pricing data that Reuters quoted, Asian diesel refining margins had increased to a record of little over $87 per barrel. US Stockpiles Increase Oil prices were further pressured last week by an increase in US crude, gasoline, and distillate stocks. In contrast to analysts’ predictions of a drop of roughly 1.6 million barrels, US crude stockpiles increased by 7.1 million barrels in the week ending September 11, according to data from the American Petroleum Institute reported by Reuters. Oil markets are still vulnerable to changes in Middle Eastern supply lines, especially the Strait of Hormuz and Saudi Arabia’s alternative export arrangements, notwithstanding Wednesday’s retreat.
