Oil prices declined on Tuesday as markets reacted to U.S. President Donald Trump's executive order waiving some sanctions and tariffs on Russian energy exports. The move raised questions about future energy supply dynamics, even as tensions in the Middle East kept concerns over regional disruptions alive.
Brent crude futures dropped 49 cents, or 0.45%, to $109.06 a barrel by 0010 GMT. The U.S. West Texas Intermediate crude (WTI) contract for November delivery fell 0.33% to $103.32, while the more-active December contract was down 46 cents, or 0.47%, at $98.08. Brent had earlier reached $110.70 per barrel, its highest level since May 20.
The executive order, issued by Trump on Friday night, waived key U.S. sanctions and tariffs on Russian goods, including penalties for purchasing its oil and gas. However, Trump noted that a final decision had yet to be made, with Secretary of State Marco Rubio indicating officials needed more time to assess the situation. Meanwhile, Russia's crude oil production increased by 65,000 barrels per day in September to 8.43 million bpd, though it remained 870,000 bpd below year-ago levels, according to the International Energy Agency.
Analysts noted that while additional Russian diesel supply could theoretically ease some pressure, traders remained more focused on the risks of further damage to energy infrastructure in the Gulf region. Yemen's Iran-aligned Houthis claimed responsibility for several attacks on Saudi energy, airport, and military targets, including an Aramco site in Yanbu and the Shaybah oilfield. Saudi authorities did not immediately confirm these claims, and Reuters could not independently verify them.
The renewed attacks heightened fears about regional stability and underscored ongoing risks to energy supply, keeping oil prices above $100 a barrel. In the U.S., crude oil stockpiles were expected to have fallen last week, along with product inventories, according to a preliminary Reuters poll.