Saudi Oil Exports Ease Concerns About Supply Disruptions

Oil prices dropped on Wednesday due to increased concerns about Middle East supply disruptions easing. Saudi Arabia is offering more crude oil loadings via ship-to-ship transfers off Oman's Sohar port, according to people familiar with the matter.

This move blunted some of the hit to global supply from attacks on the country's East-West pipeline to the Red Sea. Oil prices had surged in the previous session after shipping industry sources said crude loadings at Saudi Arabia's Red Sea export hub of Yanbu had been suspended and Riyadh had cancelled some cargo deliveries to European customers.

The U.S. Energy Information Administration reported a smaller-than-expected draw from U.S. crude inventories last week, adding downward pressure on oil prices. Crude oil stocks in the top-producing nation fell about 640,000 barrels last week, compared to expectations of a 1.62 million barrel draw.

Analysts at Citi expect near-term escalation in the Middle East to continue supporting crude oil and refined fuel prices before the Strait of Hormuz eventually reopens in the fourth quarter of 2026 with support from regional diplomatic efforts.