Oil Prices Fall on Reassessed Supply Risks Amid Diplomatic Efforts
Oil prices have fallen as markets reassess supply risks tied to the US-Iran conflict and regional chokepoints. Saudi Arabia's efforts to restore the East-West pipeline, which aims to return about half its capacity within days, have contributed to a rally in risk assets and global duration.
The diplomatic moves by the US, Gulf nations, China, and Iran have also eased supply concerns. Reuters reported that Beijing privately asked Iran to help rein in Houthi militants after an appeal to China by Riyadh, with the militant group making advances towards the Bab el-Mandeb chokepoint in recent days.
The easing of oil supply concerns has supported a rally in risk assets and global duration. The markets looked forward to the next round of diplomacy that will shape the US-Iran conflict, leading to a decline in oil prices and a rise in risk assets.