The futures price of Brent crude oil fell by 1.1% to $96.92 per barrel. Meanwhile, West Texas Intermediate (WTI) crude oil dropped by 1.4% to $89.18 per barrel. Both oil indices saw an increase of about one dollar per barrel on Wednesday.
Oil Price Growth in September
Brent oil recorded an approximate 14% increase in September, marking the highest rise since July. Similarly, West Texas Intermediate oil experienced about a 5% monthly price increase. With the resumption of oil shipments from the Gulf region, the restart of Saudi exports through the Yanbu port, and the increase in U.S. reserves, concerns about supply have diminished, and the short-term trend for oil prices remains downward.
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Increase in U.S. Crude Oil Reserves
The U.S. Energy Information Administration announced on Wednesday that the country's crude oil reserves increased by 922,000 barrels to 427.3 million barrels for the week ending September 25. This increase in reserves was contrary to analysts' predictions of a decrease of 264,000 barrels in the survey. At the same time, the status of fuel reserves indicates a tightening supply in the market. U.S. gasoline inventories decreased by 1.7 million barrels, and distillate reserves (including diesel and heating oil) also fell by 2.3 million barrels.
Situation of Middle East Oil Exports
Data from Kpler showed that Middle Eastern exports in September remained about 3.2 million barrels per day lower than February levels, making the market sensitive to any new disruptions. Additionally, the loading of tankers from Saudi Arabia's Yanbu port has resumed following the restart of operations on the East-West pipeline. However, regional flows remain below pre-invasion levels by the U.S. and the Israeli regime against Iran.
Consequences of Diesel Export Ban
Donald Trump, the President of the United States, announced that he is still considering the possibility of banning diesel exports from the country. These remarks come as the White House had previously denied reports regarding the preparation of a plan for a blanket 90-day export ban. Diesel prices in the U.S. reached a record $6.53 per gallon last week, and its inventory remains at historically low levels.
Looking Ahead to the OPEC+ Meeting
Reports suggest that OPEC+ oil-producing countries are likely to maintain their oil production targets for November at next Sunday’s meeting. This decision could impact the future of oil prices and affect the market.
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