Diplomacy Hopes Send Oil Prices Plummeting Amid Mideast Tensions
Oil prices plummeted on Monday as traders focused on diplomatic progress between the U.S. and Iran, and Saudi Arabia's ability to keep exporting crude oil despite ongoing conflict with Houthi rebels in Yemen.
The global benchmark Brent crude fell 3.7% to $100.07 a barrel, while U.S. West Texas Intermediate crude futures dipped 4.3% to $91.98 a barrel.
Traders' optimism about diplomatic progress was fueled by comments from CENTCOM Commander Admiral Brad Cooper, who said that the volume of crude oil, cargo, and liquid natural gas passing through the Strait of Hormuz had increased in recent weeks.
A Saudi army officer told The New York Times that battles were waged in southwest Yemen on Sunday, while Houthi rebels claimed to have launched missiles and drones at Riyadh and targeted oil facilities in response to Saudi air attacks.
Despite these developments, the kingdom's ability to export crude oil seemed unaffected, with data from shipping analytics firm Kpler showing that Saudi oil exports had bounced back to around 4 million barrels per day in September, up from 2.4 million bpd in August.