On Tuesday, Brent oil price fell to $114.70 per barrel. This price drop followed diplomatic developments and the possibility of reaching an agreement to end the U.S. and Israel's war against Iran. Although these developments reduced concerns about supply disruptions, attacks on Saudi Arabia, one of the world's major oil producers, weakened hopes for immediate stability in the market.
Analysis of Brent and West Texas Oil Prices
The price of Brent oil fell by 0.57%, equivalent to more than one dollar, reaching $114.70. Additionally, West Texas Intermediate crude oil also decreased by one dollar, or 1%, trading at $100.70 per barrel. However, the decline in oil prices remained limited due to the fragile prospect of peace and new attacks by Ansar Allah on Saudi Arabia.
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Security Situation in the Strait of Hormuz
According to data collected by a Washington-based think tank, October has been the worst month in terms of the number of attacks on commercial ships in the Strait of Hormuz and adjacent waterways. The Strait of Hormuz is recognized as the main focal point of the energy crisis in the Middle East, and before the onset of conflicts in February, about one-fifth of global energy supply passed through this narrow waterway. Last week, following a wave of Iranian attacks on tankers around the Strait of Hormuz, Brent oil price reached its highest level at $117 per barrel.
Increase in Diesel Production in Russia
In another development, two industrial sources reported that Russian refineries decided to increase diesel production in October. This decision was made following an agreement between the Kremlin and the U.S. regarding supply and export quotas. This action is likely to have a direct impact on the global oil market and could lead to price changes.
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