Market Move
At 15:40 ET (19:40 GMT) Brent crude futures for December rose 4.6% to $102.58 a barrel, while U.S. West Texas Intermediate for November advanced 3.1% to $93.18. The front‑month Brent contract had settled at $103.50 in the prior session, and Brent recorded a 14% gain in September – its strongest monthly rise since July – while WTI posted about a 5% increase for the month.
Geopolitical Trigger
The price jump followed media reports that the United States will deploy an additional 9‑10 thousand troops and a naval group to the Middle East by the end of November, and that President Donald Trump expects to resume bombing Iran that same month. Trump told reporters he must “make a decision” on Iran, stating the country 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.
Supply‑Side Data
Kpler data showed Middle‑East crude exports reached 16.328 million barrels per day (bpd) in September, the highest level since the February conflict began. Saudi Arabia also resumed tanker loadings from Yanbu after restarting its East‑West Pipeline. According to Macquarie energy strategist Walt Chancellor, crude and clean‑product flows through the Strait of Hormuz were just under 11 million barrels per day for the week ending 29 September, and nearly 10 million bpd since hostilities resumed on 30 August. Global crude inventories are drawing down more slowly since late August, aided by a resurgence of oil‑on‑water, but regional exports remain about 3.2 million bpd below February levels, keeping the market sensitive to further disruptions.
Diplomatic Context
Negotiations at the United Nations General Assembly failed to produce a breakthrough, with heated exchanges between Trump and Iranian counterpart Masoud Pezeshkian. 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 assets was rejected by Trump. Iran later indicated it had 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.
Diesel Market Concerns
U.S. diesel prices hit a record $6.5276 per gallon last week, and inventories remain historically low. President Trump discussed a possible 90‑day blanket ban on U.S. diesel exports, despite earlier denials. U.S. Energy Secretary Chris Wright told Fox News he is “highly confident” Europe can help ease refined‑fuel prices by drawing down emergency diesel inventories. Macquarie’s Chancellor emphasized that the U.S. diesel issue is part of a broader global energy problem, noting that the size of the inventory draw (~4 million bpd) makes finely tuned solutions difficult.
Contributors
The article was contributed by Ayushman Ojha and Scott Kanowsky.