Brent Falls Despite Asia Crude Imports at War-Era High

Asia's refiners have proven more resourceful than diplomats in finding ways to circumvent Iran war-related oil supply disruptions. Despite Brent crude falling to $96.84, down $4.77 from Tuesday's close, imports of Asian crude reached a monthly average of 23.96 million barrels per day (mb/d) in September, the highest since the conflict began in February.

This is according to cargo-tracking firm Kpler, which also reports that Asia's imports were running at just 19.15 mb/d in April when Strait of Hormuz traffic restrictions were most severe. The gap between pre-war levels and current imports remains significant, however, sitting at 13% below the baseline.

The East-West Pipeline, a crucial artery for Saudi crude exports, resumed operations on September 22 after being shut since Houthi drone attacks in mid-September. This unexpected resumption was a key bearish factor driving Brent's decline.

Iranian Foreign Minister Abbas Araghchi and US envoy Steve Witkoff engaged in mediated talks at the UN General Assembly in New York, with Qatar acting as go-between. While these discussions were described as 'constructive and promising', no joint statement emerged, leaving markets skeptical about a swift resolution to the conflict.