Oil Prices Decline on Rising Exports and G7 Reserve Release

Oil prices dropped on Monday as rising exports from the Middle East and a strategic reserve release by the Group of Seven (G7) nations eased supply concerns. Brent crude futures fell 35 cents, or 0.34%, to $101.90 per barrel by 0115 GMT, while US West Texas Intermediate (WTI) crude declined 62 cents, or 0.68%, to $90.49 per barrel.

The G7's decision to release 100 million barrels of diesel and crude from emergency reserves, along with a pledge to avoid energy export restrictions, contributed to the price decline. This move follows increased Middle Eastern crude exports, which surpassed pre-war levels in four of the last seven days of September despite attacks on vessels in the Strait of Hormuz.

Tim Waterer, chief analyst at KCM Trade, noted that the G7's reserve release has reduced immediate supply anxiety. He also highlighted that Saudi export volumes are returning to pre-war levels, though at higher costs and via less efficient routes. Despite these developments, risks of further damage to Gulf energy infrastructure remain.

Tensions in the region persisted, with Yemen's Houthis claiming attacks on Saudi Aramco sites in Riyadh and Khurais. Saudi Arabia's internationally recognized government launched a military campaign to retake areas controlled by the Houthis. Additionally, Aramco cut November crude oil prices for Asia to six-year lows.

OPEC+ postponed a review of 2027 oil output quotas due to disruptions from the US-Israeli war on Iran, which has cast uncertainty over future production potential. Meanwhile, Ukraine's President Volodymyr Zelenskiy announced plans to intensify attacks on Russian oil refineries.