Oil prices dropped to an 11-day low on Monday as traders weighed hopes for US-Iran diplomacy against continued Houthi attacks on Saudi Arabia. Brent fell toward $100 a barrel while WTI slid to $97.61, even as Saudi Aramco kept crude flowing through the Strait of Hormuz.
Brent crude fell $2.69, or 2.6%, to $101.18 a barrel at 1254 GMT on Monday, its lowest level since September 10. The WTI October contract, which expires Tuesday, dropped $2.69, or 2.7%, to $97.61 a barrel, while the November WTI contract stood at $93.49.
Traders eye a possible Iran meeting
Iran and the United States exchanged new threats on Sunday. Still, President Donald Trump said he would be open to meeting Iranian President Masoud Pezeshkian, who is expected in New York this week for the United Nations General Assembly. Iran has conveyed its conditions to mediators for re-engaging in negotiations, Al Jazeera reported, citing Iran's security chief, Mohsen Rezaei.
Fighting in the Middle East continued regardless. Yemen's Iran-backed Houthis said they attacked Riyadh as well as a Saudi Aramco facility in the Red Sea city of Yanbu, while pushing to cut off the Red Sea coast from remaining areas held by Saudi-backed forces. China has asked Iran to help rein in the Houthis after Saudi Arabia appealed to Beijing following the attacks, according to three Iranian sources familiar with the matter.
Saudi Arabia reroutes crude through Hormuz
The Houthi attacks on Aramco's East-West pipeline have prompted the firm to increase exports through the Strait of Hormuz this month and next, after halting some shipments via Yanbu. According to JPMorgan analysts: "Middle East oil flows remain surprisingly strong despite the disruption to Saudi Arabia's East-West pipeline." The analysts, in a September 18 note, said the most notable pivot has come from Saudi Arabia, as satellite data indicated Saudi oil moving through the Strait of Hormuz averaged 2.9 million barrels a day over the past six days, up from just 700,000 barrels a day in August.
Source: Investing.com/Reuters
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