Oil prices fell sharply Monday, with Brent crude dropping to its lowest point in 11 days as markets responded to possible diplomatic movement between the United States and Iran and signs that Saudi Arabia is successfully rerouting crude exports. Brent crude for November fell $2.69, or 2.6%, to $101.18 a barrel by 12:54 p.m. GMT after touching its lowest level since September 10.
U.S. West Texas Intermediate crude followed suit. The October contract, set to expire Tuesday, dropped $2.69, or 2.7%, to $97.61 a barrel, while the November WTI contract stood at $93.49.
Trump Open to Meeting Iranian President at the U.N.
The sell-off came despite continued fighting across the Middle East and a fresh round of threats between Washington and Tehran over the weekend. President Donald Trump said Sunday that he would be open to meeting Iranian President Masoud Pezeshkian, who is expected to travel to New York for this week’s United Nations General Assembly. Iran also conveyed conditions to mediators for potentially reopening negotiations, according to a report citing Iranian security chief Mohsen Rezaei.
Those diplomatic signals helped push oil prices lower as traders weighed the possibility that talks could reduce the risk of further escalation in the region. Investors are now tracking oil prices Iran talks closely as U.N. sessions get underway and both sides signal tentative openness to engagement.
Saudi Arabia Reroutes Exports Through the Strait of Hormuz
Iran-backed Houthi forces in Yemen claimed attacks on Riyadh and a Saudi Aramco facility in the Red Sea city of Yanbu over the weekend, while continuing their push to expand control inside Yemen. China has also pressed Iran to help restrain the Houthis, following an appeal from Saudi Arabia, according to sources familiar with the discussions.
Saudi Aramco has responded by sharply increasing exports through the Strait of Hormuz this month and next to work around disruptions to the kingdom’s East-West pipeline. JPMorgan analysts noted in a September 18 report that the shift has been dramatic.
