On Thursday, oil prices fell with Brent crude futures for December delivery decreasing by 1.66% to $104.31 per barrel, while U.S. West Texas Intermediate futures for November dropped 1.09% to $94.05 per barrel. This decline follows the sinking of a Singapore-registered ship in the Strait of Hormuz, raising concerns about potential disruptions in a critical shipping lane amid escalating tensions.
The Singapore maritime authority condemned the attacks as breaches of international law, and Iran has threatened to target U.S. warships. The International Energy Agency's October report highlighted ongoing constraints in diesel markets that could persist into next year, compounded by new threats to Saudi oil supply.
In response to rising prices, the Trump administration is reportedly considering easing sanctions on vessels transporting oil from countries like Russia.
Firas Bechwaty from ICM noted that the lack of progress in U.S.-Iran diplomatic efforts diminishes the likelihood of reopening the Strait, although Saudi crude continues to reach buyers through alternative routes, and emergency stock releases from IEA members are providing some price stability despite heightened tensions