WTI Crude Oil Prices Plummet as Freight Costs Soar and Diesel Export Ban Looms

Oil prices are edging higher this week as diplomatic efforts to end hostilities in the Middle East gain traction, but the US benchmark WTI is expected to decline by 7% due to soaring freight costs and concerns about US refiners cutting runs.

The Brent-WTI spread has widened to $12 per barrel, with Brent trading at a premium. This discrepancy is largely driven by the prospect of US refiners reducing production in response to higher diesel prices and the potential for an export ban on diesel fuel.

Meanwhile, Iran and the US are reportedly discussing a phased deal that would see Iran reopen the Strait of Hormuz in exchange for a rollback of the US blockade. This development could potentially ease tensions in the region and lead to increased oil exports.