Oil prices fall despite tensions in the Middle East

The maintenance of exports from the Middle East and the expected arrival of barrels from strategic reserves weighed on oil prices on Monday. Despite a conflict still with no prospect of calming down, Brent from the North Sea for delivery in December lost 1.89%, to $100.32 per barrel. US West Texas Intermediate (WTI) for November fell 1.84% to $89.43.

Supplies have so far held up better than feared. Crude exports from Middle Eastern countries, excluding Iran, exceeded their pre-war level last week, according to data from maritime tracking company Kpler. More than 18 million barrels per day were exported despite the attacks in the Strait of Hormuz. A growing part of the flows passes through the Red Sea in order to circumvent the blockade that Tehran is trying to impose on Hormuz.

100 million barrels of crude oil and diesel

The market should also benefit from additional volumes from global strategic reserves. G7 members committed at the end of last week to release 100 million barrels of crude oil and diesel. However, the situation remains fragile. “There is, however, a significant risk of further escalation by both Iran and the United States, which could quickly lead to new price surges,” warn Eurasia Group experts.

Relations between Washington and Tehran remain tense, more than seven months after the first strikes by the United States and Israel against Iran. Negotiating with the United States makes “no sense,” Iranian President Massoud Pezeshkian said on Monday, according to state television Irib. Talks between the two countries still appear to be deadlocked, while risks of disruptions to oil production and transport remain.

The uncertainties of the conflict in the Middle East

In Saudi Arabia, oil transport via the East-West pipeline was again interrupted after an attack on Sunday in the east of the kingdom claimed by Yemen's Houthis, according to an energy sector source. This infrastructure makes it possible to transport crude oil from eastern Saudi fields to the Red Sea, avoiding the Strait of Hormuz. She had already been arrested from September 11 to 22 after strikes launched from Iraq, according to Riyadh.

Our file on fuels

These disruptions could continue to support prices despite their decline on Monday. “Further disruptions to regional flows due to attacks on Saudi oil infrastructure and Iran's persistent attempts to control the Strait of Hormuz will keep prices high,” estimates Eurasia Group. Another source of concern, the boss of the Saudi giant Aramco, Amin Nasser, judged world oil reserves “dangerously low” on Monday in London.