Oil prices below $100-a-barrel again: Here we decode why
What's the story
Oil prices have dropped below the $100-a-barrel mark, with West Texas Intermediate (WTI) crude trading at $90.10 a barrel and Brent crude at $99.09 today. The decline comes after Saudi Arabia has restarted operations on its East-West Pipeline to the Red Sea. The move is expected to ease supply constraints and stabilize global oil markets amid ongoing geopolitical tensions in the region.
Resumption
Saudi Arabia resumes operations on East-West pipeline
Saudi Arabia has resumed operations on its East-West Pipeline to the Red Sea, a vital route for crude oil transport.
The pipeline was shut down on September 11 after drone attacks, which Saudi Arabia blamed on an Iraqi militia.
Before the attacks, it had been transporting about four million barrels of crude per day to Yanbu port, accounting for roughly 4% of global oil supply.
Diplomatic efforts
Hopes of US-Iran war diplomatic breakthrough
The resumption of the Saudi pipeline comes amid hopes of a diplomatic breakthrough in the US-Iran conflict.
President Donald Trump has said his envoys have had productive talks with Iranian mediators aimed at ending the war.
"I think there's a lot of momentum for them to make a deal," he said, adding that these developments are putting pressure on benchmark crude prices.
Supply dynamics
Iraq exports and US crude inventories rise
Iraq is also ramping up its oil exports, with Oil Minister Basim Mohammed announcing that the country was exporting more than three million barrels per day.
Provisional figures from ship-tracking companies Vortexa and Kpler put Iraq's crude exports in August at 2.3 million bpd and 2.17 million bpd, respectively.
Meanwhile, industry data showed US crude inventories rose by 1.8 million barrels in the week to September 18, contrary to analysts' expectations of a decline.