Key Points
- Brent falls 73 cents to $102.90 a barrel.
- WTI drops 88 cents to $95.21, 0.92 per cent.
- Murban physical oil declines $3.14 to $102.20 a barrel.
ISLAMABAD: International oil prices fell again on Wednesday, with Brent slipping below $103 a barrel and the US benchmark moving closer to $95, as markets assessed diplomatic efforts to end the US-Iran war.
Brent futures were quoted at $102.90 a barrel on the latest OilPrice.com market board, down 73 cents, or 0.70 per cent. US West Texas Intermediate (WTI) futures fell 88 cents, or 0.92 per cent, to $95.21.
The latest figures indicated a renewed decline after oil prices had recovered from an earlier sharp fall.
Brent rebounded to $104 before briefly falling by $6. The recovery proved limited, with both major benchmarks subsequently showing losses on the latest price board.
The physical-market assessment for Abu Dhabi’s Murban grade stood at $102.20 a barrel, down $3.14, or 2.98 per cent.
The decline was steeper than Brent and WTI futures. Murban is a physical oil benchmark, and its assessment is not directly comparable with continuously traded futures quotations.
Refined products also fell Wednesday. Gasoline futures fell 0.47 per cent to $2.922 a gallon, while heating oil declined 0.54 per cent to $4.506. Natural gas futures fell 1.04 per cent to $2.865.
Diplomacy and supply concerns
The latest decline follows a sharp sell-off earlier in the week, when expectations of a possible diplomatic settlement between the United States and Iran encouraged traders to reduce the risk premium built into oil prices.
However, the market remains vulnerable to developments in the conflict. The Strait of Hormuz, through which a significant share of internationally traded oil passed before the fighting, remains a central concern for energy producers and importing countries.
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A sustained disruption to shipping through the waterway could keep supplies tight even if diplomatic contacts continue.
Rystad Energy has warned that oil flows through Hormuz may not return to pre-war levels.
The market has also been responding to reports of military activity and the possibility of further escalation.
The brief price rebound was following reports of US strikes on Iran. It reflected how quickly market sentiment can shift when diplomatic expectations face challenges.
For importing countries, the latest retreat offers some relief after prices climbed sharply during the conflict. But disrupted exports and higher transportation costs continue to complicate the energy market.
US stock figures under scrutiny
Developments in the United States election are another key influence on oil prices. US crude inventories are falling sharply, drawing investors’ attention to tightening domestic stocks.
Inventory movements matter because they indicate the balance between supply and demand in the world’s largest oil-consuming economy.
A sustained decline in crude stocks can support prices when it coincides with Middle East supply concerns.
The market is also monitoring gasoline and heating oil stocks as indicators of fuel demand and refinery activity.
The latest declines in gasoline and heating oil futures suggest that weakness in the wider energy market is extending beyond the main crude benchmarks.
The International Energy Agency has also warned that a global gas supply crunch could continue well into 2027, according to another headline on the OilPrice.com board. Although petroleum markets have different supply dynamics, prolonged disruption to energy flows could add to uncertainty across the wider energy sector.
The latest price movement therefore reflects competing forces. Anticipated progress in US-Iran diplomacy is containing the immediate geopolitical premium. Depleting US inventories and Gulf supply risks are limiting the scope for a sustained decline.
For now, the latest market quotations show Brent below $103 and WTI near $95.
The direction will depend heavily on whether diplomatic efforts produce a durable reduction in regional tensions and whether oil supplies can move more reliably through key export routes.
