Oil prices fell on Wednesday after reports that Saudi Arabia was making additional crude cargoes available to Asian refiners through Oman, providing an alternative export arrangement following disruptions to its Red Sea infrastructure.
At 08:01 GMT, Brent crude futures declined 83 cents, or 0.76%, to $107.92 a barrel. US West Texas Intermediate futures dropped $1.41, or 1.33%, to $104.42 a barrel.
The declines followed gains of more than $3 in the previous session, when reports of suspended loading operations at Saudi Arabia’s Yanbu export terminal raised concerns about the availability of crude supplies.
Shipping industry sources also reported that Saudi Arabia had cancelled some cargo deliveries to European customers.
The disruption followed attacks affecting a major Saudi pipeline used to transport crude to the Red Sea, an export route that provides an alternative to the Strait of Hormuz.
Additional Saudi Cargoes Offered Near Sohar
Saudi Arabia is offering more crude to Asian refiners through ship-to-ship transfers off the coast of Oman near Sohar, according to people familiar with the arrangements.
The additional cargoes follow drone attacks that damaged the kingdom’s principal oil pipeline to the Red Sea.
UBS analyst Giovanni Staunovo said the reports of Saudi exports through the Gulf indicated that concerns about a more extensive disruption were easing.
Nevertheless, shipping activity through the Strait of Hormuz remained substantially below recent levels.
Preliminary data released on Wednesday showed four visible vessel transits on Tuesday, compared with seven the previous day and a 10-day average of 18.
Before the US-Israeli war on Iran began in late February, the strait accounted for approximately one-fifth of global oil and liquefied natural gas supplies.
Macquarie analysts said crude, condensate and refined product flows through Hormuz had continued despite the regional conflict.
They estimated that volumes may have exceeded 7.5 million barrels per day since fighting resumed on 30 August.
The analysts also suggested that developments affecting the waterway were no longer translating as directly into changes in actual oil flows.
Citi expects further escalation in the Middle East to support crude and refined fuel prices in the near term.
The bank forecasts a reopening of the Strait of Hormuz during the fourth quarter of 2026, supported by diplomatic efforts involving regional countries. The timing remains Citi’s projection rather than an established outcome.
European Diesel Futures Reach Record Closing Level
European diesel futures settled at a record high on Tuesday and reached their highest intraday level since April.
The increase reflected constraints on crude and refined product shipments associated with the Middle East conflict.
Staunovo said diesel prices were likely to remain supported unless a peace agreement was reached or conditions in Russia improved.
Unexpected US Stock Build Adds to Selling Pressure
An increase in US petroleum inventories provided another factor behind Wednesday’s decline in crude prices.
Market sources citing American Petroleum Institute figures said crude oil, gasoline and distillate stocks had all risen during the week ended 11 September.
US crude inventories increased by 7.1 million barrels. Analysts surveyed by Reuters had expected a decline of approximately 1.6 million barrels.
Gasoline and distillate inventories also recorded unexpected increases, contributing to downward pressure on oil prices.
Haitong Futures said the inventory data weighed on crude prices but maintained that higher regional stock levels did not resolve the broader constraints affecting global oil supplies.
The market therefore faced two developments: additional Saudi export arrangements and higher US inventories on one side, and continuing restrictions affecting Middle Eastern crude and fuel shipments on the other.
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