WTI settled at $92.60 and Brent at $105.28 on Monday after Saudi Arabia restored flows through its repaired East-West pipeline, pulling both benchmarks well off their intraday highs. President Trump rejected Iran's offer to reopen the Strait of Hormuz, and Qatari mediators are set to hold fresh talks this week while Washington has signaled openness to sanctions relief. Diesel prices keep climbing on Middle East and Ukraine supply disruptions, widening the gap between Brent and WTI futures.
Crude oil pulled back from its highest levels of the day on Monday after Saudi Arabia restored flows through its East-West pipeline to about 3.5 million barrels per day following repairs from an earlier drone strike, people familiar with the matter said. West Texas Intermediate still settled 19 cents higher at $92.60 after touching $96.54 earlier in the session, while Brent crude closed up 96 cents at $105.28 following an intraday high of $108.83.
Qatar to mediate fresh talks after Trump rejects Iran's offer
Trump turned down a proposal from Iran to reopen the Strait of Hormuz. According to CNBC: "They made a proposal but I rejected it." Iranian Foreign Minister Abbas Araghchi had offered on Friday to reopen the route and restart nuclear talks within seven days if Washington ends what Tehran calls acts of aggression, lifts its naval blockade and economic warfare, and releases frozen Iranian assets, according to Iranian foreign ministry spokesman Esmaeil Baghaei.
Qatari mediators are expected to hold separate talks with Araghchi in New York and with the US side on Monday or Tuesday, focusing on an amended version of the seven-day proposal Iran presented last week at the United Nations General Assembly, an official briefed on the negotiations said.
Washington leaves the door open on sanctions
A White House official told CNN that Trump is open to sanctions relief for Iran and the release of frozen funds if concrete progress is made toward a nuclear deal. Still, the Wall Street Journal reported Friday that Trump expects US strikes on Iran to resume after November's midterm elections, citing unnamed officials, even as Saudi Foreign Minister Prince Faisal bin Farhan arrived in Washington for talks with Secretary of State Marco Rubio.
Middle East supply rebounds, but diesel stays tight
Crude oil exports from major Middle East producers rebounded in September to 12.8 million barrels per day, the highest since the war started in February, preliminary data from Kpler showed, as Saudi Arabia and the United Arab Emirates ramped up shipments. Flows through the Strait of Hormuz were on track to hit about 7.4 million barrels per day this month, the data showed.
Even so, diesel prices keep soaring on wartime supply disruptions and export bans in Russia and China. The premium of Brent futures over WTI rose Monday to its highest since May for the third time in four sessions, a signal that markets expect US refiners to process less crude oil if diesel output stays stuck at home.
Sources: Reuters via Investing.com, CNBC
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