Oil prices fell on Monday as increased crude exports from the Middle East and withdrawals from oil inventories held by G7 countries added to supplies, offsetting concerns over further potential damage to oil infrastructure in the Gulf amid the US-Israeli war with Iran.
Brent crude futures fell 66 cents, or 0.65%, to $101.59 a barrel by 2:40 a.m. GMT, while US West Texas Intermediate (WTI) crude stood at $90.12 a barrel, down 95 cents, or 1.03%.
Brent gave up most of its gains from last week, while WTI fell 1.6% after G7 countries agreed on Friday to release 100 million barrels of diesel and crude from emergency reserves. They also pledged to refrain from imposing restrictions on energy exports following pressure from US President Donald Trump.
The release of reserves will add to Middle Eastern crude exports, which rose above prewar levels on four of the seven days during the final week of September, shipping data showed on Monday, despite attacks on vessels transiting the Strait of Hormuz.
Tim Waterer, an analyst at KCM Trade, said the G7 decision to release strategic reserves eased some immediate supply concerns that had been supporting prices, while expectations were growing that Saudi crude export volumes were returning toward prewar levels, even though the barrels were still being transported at higher costs and through less efficient routes.
“This combination is enough to cap prices for now, although the risk of further damage to energy infrastructure in the Gulf region has not disappeared,” he said.
The Houthis said they had launched ballistic missiles and drones at Aramco facilities in Riyadh and the Khurais area of Saudi Arabia, in response to 50 Saudi-led air and missile strikes in Yemen over the previous 12 hours. Saudi Arabia has not confirmed the claims.
Yemen’s internationally recognized government, backed by Saudi Arabia, said on Sunday that it was launching a major military campaign to retake all areas of the country controlled by Iran-aligned Houthi forces. Meanwhile, Saudi Aramco unexpectedly cut its November crude prices for Asia to their lowest level in six years.
Analysts at ING said in a note that Brent prices remained above $100 a barrel due to continued geopolitical tensions and an increase in attacks on commercial vessels in the Gulf.
Two sources familiar with the matter said OPEC+ had postponed a review that was expected to determine oil production quotas for its members in 2027. The war with Iran has disrupted capacity expansion projects across the Middle East, creating uncertainty over future production potential.
In Europe, Ukrainian President Volodymyr Zelenskyy told Reuters in an interview published on Saturday that Ukraine would step up attacks on Russian oil refineries.
Source: Reuters
