Key facts
- Oil prices edged higher Tuesday as investors awaited potential US-Iran talks.
- Brent crude futures gained 0.22% to $100.57 a barrel, and WTI October contract rose 0.02% to $95.8.
- Saudi Arabia is rerouting crude oil exports via Oman to avoid the Strait of Hormuz following attacks on its East-West pipeline.
- The East-West pipeline was shut down by drone strikes, taking 4-5 million barrels a day of capacity offline.
- Houthi missile and drone strikes targeted facilities at the Red Sea port of Yanbu, the termination point for the East-West pipeline.
- Saudi Aramco loaded about 14 million barrels of crude oil on seven supertankers inside the Gulf on Sunday.
Oil prices steadied on Tuesday after several days of declines, with investors awaiting potential diplomatic developments between the US and Iran. Brent crude futures for November delivery gained 0.22% to $100.57 a barrel, while the expiring WTI October contract rose 0.02% to $95.8. The more actively traded November WTI contract was up 0.14% at $92.49.
Middle East tensions remain elevated following Houthi attacks on Saudi energy infrastructure, including the East-West pipeline and facilities at the Red Sea port of Yanbu. These attacks forced Saudi Arabia to reroute crude exports via Oman, utilizing ship-to-ship transfers in the Gulf of Oman. Satellite data indicated a significant increase in tankers at Saudi Gulf terminals, suggesting a shift in export routes.
Analysts suggest the slight price increase is a typical short-covering bounce rather than a fundamental shift, with traders taking risk off the table as diplomatic narratives unfold. Iran has conveyed its conditions for re-engaging in negotiations, and President Trump has indicated openness to meeting Iranian President Masoud Pezeshkian at the UN General Assembly this week. China has reportedly urged Tehran to help curb Houthi attacks after Saudi Arabia appealed to Beijing.