Oil falls 1% amid hopes of limited disruptions — Channel NewsAsia
Oil prices fell by about 1% on September 18, extending their decline for a third consecutive session, but remained above $100 per barrel. Hopes for alternative ways to deliver Middle Eastern oil to markets outweighed concerns over new strikes between Saudi Arabia and Yemen’s Houthis.
As Channel NewsAsia reports, citing Reuters, Brent crude futures as of 00:20 GMT were down $1.01, or 1%, at $103.77 per barrel. U.S. West Texas Intermediate crude fell by $1.03, or 1%, to $100.88 per barrel. Both benchmarks had also lost about 1% the previous day.
Pipeline damage
This week, prices rose to their highest levels in about four months. Reuters sources reported a halt in oil loading at Saudi Arabia’s Red Sea export hub of Yanbu and the cancellation of some deliveries to Europe after the East-West pipeline was damaged in an attack last week.
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According to satellite images and three industry sources, three pumping stations on the pipeline were damaged — one more than previously estimated. Traders said a prolonged shutdown of the route to Yanbu could reduce global oil supplies by up to 4%.
Alternative routes
Bloomberg reported that Saudi Arabia is seeking to restore about half of the East-West pipeline’s capacity within several days. The country also offered Asian refineries additional oil cargoes through ship-to-ship transfers near Oman’s port of Sohar. U.S. Energy Secretary Chris Wright said oil could resume flowing through the pipeline within a few days.
According to Iranian state media, the naval forces of the Islamic Revolutionary Guard Corps said an oil tanker flying the Togolese flag, which allegedly attempted to pass through the Strait of Hormuz illegally, was hit on September 17. JPMorgan said that for the first time since the start of the U.S. and Israeli war against Iran, it has no clear base-case scenario for the oil market.
