Oil prices dipped by approximately 1% as markets balanced potential US-Iran diplomatic progress against concerns over Houthi attacks on Saudi Arabia, which could threaten oil supply. Brent futures fell $1.14 to $105.46 a barrel, while West Texas Intermediate (WTI) crude dropped $1.05 to $93.56. Despite the decline on Friday, Brent saw a weekly increase of about 2%, whereas WTI fell by around 7%.
Negotiators from the US and Iran are discussing a phased resolution to the ongoing conflict, which could see Tehran reopen the Strait of Hormuz and the US lift its sanctions on Iran. Meanwhile, military leaders from Saudi Arabia are planning to strategize support for Saudi Arabia amid ongoing Houthi assaults.
Crude oil exports through the Strait of Hormuz remained stable, with preliminary data indicating 33.7 million barrels exported in the week starting September 20. A possible US ban on diesel exports is widening the price gap between US crude and Brent, reflecting expectations that refiners may process less crude oil.
In related news, the US has proposed a trilateral meeting in the UAE to discuss peace efforts between Ukraine and Russia, while drone strikes have temporarily halted operations at a Russian oil refinery, highlighting ongoing energy-related tensions in the region.
