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Oil
Source: Newsmaker.id
Oil prices weakened during Wednesday's trading (Sept. 16) after reports that Saudi Arabia was offering additional cargoes via Oman eased concerns regarding Middle East supply disruptions. Brent fell 1.55% to US$107.06 per barrel, while WTI declined 2.46% to US$103.23 per barrel.
Saudi Arabia reportedly offered additional supplies to Asian refineries via ship-to-ship transfers near the Port of Sohar, Oman, following a drone attack that damaged a pipeline leading to the Red Sea. This move alleviated fears that Saudi export disruptions would be more extensive or prolonged than initially anticipated.
However, conditions in the Strait of Hormuz remain abnormal. Only four vessels were observed passing through on Tuesday—down from seven the previous day and well below the 10-day average of 18 vessels. Nevertheless, Macquarie assesses that the flow of oil and energy products through the waterway remains relatively resilient amidst escalating regional conflict.
The diesel market also remains tight. European gasoil briefly touched its highest intraday level since April before closing at a record high, while average diesel prices in the US have surpassed US$6 per gallon. Supply disruptions in the Middle East and production issues at Russian refineries continue to support fuel prices.
Newsmaker Analysis: Current downward pressure on Brent and WTI stems from the additional Saudi supply and a 7.1-million-barrel rise in US crude inventories—sharply contrasting with expectations of a 1.6-million-barrel decline. However, upside risks persist, as traffic through Hormuz remains low and the diesel market stays extremely tight. As long as disruptions involving the Middle East and Russia continue, oil prices have the potential to remain elevated despite short-term corrections. (arl)
Source: Newsmaker.id