Oil Prices Ease on Supply Boost Expectation, Brent Dips to $101
Oil prices fell on Friday as expectations that European countries could release emergency diesel reserves eased concerns over tight refined-product supplies, although renewed geopolitical tensions in the Middle East limited losses.
International benchmark Brent crude futures for December delivery decreased 1.6% to $101.32 per barrel, down from $103 at the previous close. US benchmark West Texas Intermediate (WTI) crude futures for November delivery fell 1.4% to $91.65 per barrel from $93.
US President Donald Trump said Thursday that he may ask European countries to release some of their diesel reserves as part of efforts to bring down fuel prices.
Asked about the proposal, Trump said: “We may do that. They have some diesel. The prices are coming down. All prices are coming down.”
The proposal calls for a coordinated release of diesel from EU countries’ national strategic reserves.
Under the plan, member states are asked to release 120 million barrels of diesel over 180 days, equivalent to more than one-third of the bloc’s total diesel reserves of around 315 million barrels.
Trump also said oil prices could fall sharply once the war with Iran ends.
“One way or the other, it’s going to end very quick,” he said. “And when that ends, oil prices are going to drop like a rock.”
His comments came amid reports that the Trump administration has been urging European countries to tap emergency diesel inventories to ease pressure on global fuel prices.
Trump also claimed that US forces had recently moved more oil through the Strait of Hormuz, saying the US Navy had imposed a blockade and was the only force able to secure passage through the waterway.
“When that happens, when that ends, which will be very soon. One way or the other, it is going to end,” he said, referring to the war.
“Either they’ll do something very proper and smart, or they won’t be around very long,” he said.
On the other hand, the US reportedly deployed two additional Patriot missile defense batteries to the region to protect oil and natural gas facilities in Saudi Arabia and Qatar.
According to Axios, citing unnamed sources, Washington seeks to reassure Qatar and Saudi Arabia that key energy facilities will be protected in the event President Trump resumes attacks on Iran.
The development raises concerns over a renewed escalation in the conflict with Iran, keeping geopolitical risk premium in oil market elevated.
Reports that Chinese refiners will halt fuel exports to destinations outside Hong Kong and Macao in October also fuel concerns over tightening supply in global fuel markets.
Beijing’s move, aimed at preserving domestic inventories, is expected to further tighten a market already facing supply constraints. Refiners Secure 112m Barrels Out of 182m Offered – NUPRC
