Oil Prices Drop as G7 Releases Stocks and Middle East Exports Rise

Oil prices dropped on Monday as rising crude exports from the Middle East and the G7's decision to release emergency oil stocks boosted global supplies. Brent crude futures fell 72 cents, or 0.71%, to $101.59 a barrel, while US West Texas Intermediate (WTI) crude dropped $1.05, or 1.2%, to $90.05 a barrel. The G7's agreement to release 100 million barrels of diesel and crude, coupled with increased Middle Eastern exports, offset concerns about ongoing geopolitical tensions in the Gulf region.

The rise in Middle Eastern crude exports above pre-war levels, despite attacks on vessels in the Strait of Hormuz, contributed to the price decline. Tim Waterer, chief analyst at KCM Trade, noted that the G7's strategic reserve release and the return of Saudi export volumes to near pre-war levels have eased immediate supply anxieties, even though risks to Gulf energy infrastructure remain.

Geopolitical tensions continued to influence the market, with the Houthis launching ballistic missiles and drones at Saudi Aramco sites in response to Saudi-led strikes in Yemen. Meanwhile, Ukraine's President Volodymyr Zelenskiy announced plans to intensify attacks on Russian oil refineries. Additionally, OPEC+ delayed a review of 2027 oil output quotas due to disruptions caused by the Iran war, adding uncertainty to future production estimates.

Despite these developments, Brent prices remained above $100 per barrel due to persistent geopolitical risks and increased attacks on commercial vessels in the Gulf. ICE gasoil futures rose more than 2% to $1,390.25 a barrel, reflecting ongoing concerns about fuel supply.