Brent Crude Falls Below $100 as Diplomatic Hopes Offset Disruptions
Oil prices have fallen to their lowest level in 12 days as investors become optimistic about diplomatic progress between the US and Iran. The Brent crude futures contract dipped below $100 a barrel on Monday, marking its lowest price since September 9.
The decline was driven by hopes of a breakthrough in peace talks during this week's UN General Assembly, which has weighed on prices according to Tamas Varga, analyst at PVM Oil Associates. The sharp drop also reflects investors' growing confidence that Saudi Arabia's oil exports will recover from disruptions caused by the recent attacks.
Saudi Aramco increased exports through the Strait of Hormuz this month and next after halting some shipments via Yanbu due to the attacks by the Houthis on its East-West pipeline. Satellite data shows Saudi oil moving through the Strait of Hormuz averaged 2.9 million bpd over the past six days, up from just 700,000 bpd in August.
Libya's National Oil Corp Chairman Massoud Suleman told Reuters that the country's Sharara oilfield has seen a partial reduction in production without giving a reason.