Oil prices declined on Friday as concerns over potential Saudi Arabian supply disruptions eased, offsetting anxieties about expanding conflict across the Middle East region. Brent crude futures fell 88 cents, or 0.84%, to $103.94 a barrel by 1225 GMT on September 18, 2026. U.S.
West Texas Intermediate futures remained relatively stable at $102.15. Benchmark Brent prices are tracking toward their first weekly loss in three weeks, down 0.8% for the week. According to PVM Oil Associates analyst Tamas Varga, immediate concerns over supply tightness have been mitigated by several factors.
Saudi Arabia has increased crude loading via Oman, oil product inventories have grown in the U.S., Singapore, and Europe, and China has boosted fuel exports. Varga stated that "while continuous pre-weekend profit-taking cannot be ruled out, the current fundamental outlook would not justify a prolonged fall below $100 (a barrel) basis Brent." Markets largely dismissed concerns despite fresh military exchanges between Saudi Arabia and Yemen's Iran-backed Houthis on Thursday, which expanded the Middle East conflict zone. Earlier in the week, prices had climbed to near four-month highs after reports indicated that crude loadings at Saudi Arabia's Red Sea export hub of Yanbu had been suspended and Riyadh had cancelled certain European deliveries following an attack on its East-West pipeline.
However, prices have moderated since reports emerged that Saudi Arabia was working to restore approximately half the capacity of its East-West oil pipeline within days. Sources speaking with Reuters have provided varying estimates regarding the timeline for full pipeline reopening and return to normal crude flows. China's refined oil product exports in August rose 12.7% year-on-year, with jet fuel exports reaching record levels, according to customs data released on Friday.
Refined product stocks increased by 3.7 million barrels the previous week, driven by builds in Western markets and Singapore. Philipp Nova head of market insights Priyanka Sachdeva noted that "the key question is whether physical flows can normalise and what the timeline could be. If we see a sustained improvement in Hormuz traffic, some of the geopolitical premium can unwind further." Transportation through the region remains risky.
Preliminary shipping data showed that four commodities vessels passed through the Strait of Hormuz on Thursday, below the 10-day average of approximately 16 vessels. Three liquefied natural gas vessels reappeared outside the Strait of Hormuz on Thursday. These figures may change as some vessels typically disable transponders during voyages to avoid detection in the conflict zone.
The U.S. and Iran have held no peace talks since an interim agreement collapsed in June. The conflict is expected to be discussed at the United Nations General Assembly next week, with an Iranian delegation permitted to attend per the U.S. State Department.
Source: Yahoo Finance, Reuters reporting by Seher Dareen, Sethuraman NR, and Arathy Somasekhar.
Source: finance.yahoo.com