Market Move
On Thursday, Brent crude futures for December climbed 4.6% to $102.58 a barrel at 15:40 ET (19:40 GMT), while front‑month Brent settled at $103.50 in the prior session. The contract posted a 14% gain in September, its strongest monthly increase since July. U.S. West Texas Intermediate (WTI) November futures rose 3.1% to $93.18 a barrel, with September WTI up about 5% overall.
US Military Deployment and Policy Stance
The Wall Street Journal reported that the United States is dispatching a third aircraft‑carrier strike group and additional Marine Corps vessels to the Middle East, which would add roughly 9,000‑10,000 troops by the end of November. President Donald Trump told aides he expects to resume bombing Iran in November, stating Iran will either sign a “very fair deal” or “won’t exist any longer.” He also reiterated U.S. control of the Strait of Hormuz and claimed current oil flow through the strait exceeds any historical level.
Gulf Oil Supply Dynamics
Kpler data showed Middle‑East crude exports reached 16.328 million barrels per day (MBD) in September, the highest level since the February conflict began, yet still about 3.2 MBD below February’s peak. Saudi Arabia resumed tanker loadings from Yanbu after restarting its East‑West pipeline. Macquarie energy strategist Walt Chancellor noted that for the week ending 29 September, just under 11 MBD of crude and clean products moved through the Strait of Hormuz, with nearly 10 MBD since hostilities resumed on 30 August. He added that global crude inventories are drawing down more slowly since late August, helped by a resurgence of oil‑on‑water.
Diplomatic Efforts
Negotiations at the United Nations General Assembly failed to produce a breakthrough; Trump and Iranian counterpart Masoud Pezeshkian exchanged heated remarks, and no tangible agreement emerged. Earlier in the week, Trump rejected Tehran’s proposal to reopen the strait for seven days in exchange for a cease‑fire, lifting of the naval blockade, sanctions relief, and unfreezing of Iranian assets. Iran later said it received a U.S. response to its latest proposal. Bloomberg reported that Iran’s foreign minister, in private talks, suggested restoring access to nuclear inspectors in return for sanctions relief, a move that could potentially break the stalemate.
Diesel Market Concerns
U.S. diesel prices hit a record $6.5276 per gallon last week, while diesel inventories remain historically low. President Trump indicated ongoing discussions about a possible 90‑day blanket ban on U.S. diesel exports, despite earlier White House denials. Energy Secretary Chris Wright told Fox News he is “highly confident” that Europe can help ease refined‑fuel prices by drawing down emergency diesel inventories.
Analyst Commentary
Chancellor emphasized that the United States’ energy problem is part of a broader global energy issue, noting the tight link between U.S. crude imports/exports and refinery inputs/outputs, and the scale of a ~4 MBD global inventory draw linked to the conflict, which limits the feasibility of finely tuned solutions without downstream impacts.
Contributors
The article was contributed by Ayushman Ojha and Scott Kanowsky.