Oil prices declined in early trading on Thursday, continuing losses from the previous session, after reports that Saudi Arabia was offering additional crude cargoes via Oman helped ease worries over supply disruptions in the Middle East.
Brent crude futures fell $1.24, or 1.2%, to $104.59 a barrel, while U.S. West Texas Intermediate futures dropped $1.14, or 1.1%, to $101.29. Both benchmarks had declined by about $3 on Wednesday.
Market participants noted that the availability of alternative shipping routes through Oman reduced immediate concerns about tight supply. Expectations of potential progress in easing regional tensions ahead of a U.S.-China summit next week also limited upward pressure on prices.
Saudi Arabia is providing more loadings of crude to Asian refiners through ship-to-ship transfers off Oman’s Sohar port. This measure has partially offset the impact of attacks on the kingdom’s East-West pipeline that feeds the Red Sea export hub of Yanbu. Loadings at Yanbu had been suspended, and some cargo deliveries to European customers were cancelled following the pipeline damage.
Yanbu had become a key export outlet after disruptions affected the Strait of Hormuz earlier in the year. Two pumping stations on the East-West pipeline were damaged in an attack last week, with the repair timeline remaining unclear.
Despite the price decline, concerns over the ongoing conflict in the region persist. Military actions continued, with reports of strikes and drone and missile activity.
Separately, U.S. crude inventories fell by about 640,000 barrels last week, a smaller decline than the expected 1.62 million-barrel draw. The more moderate stock decrease contributed to the softer price environment.
Overall, the combination of alternative Saudi export arrangements and the inventory data weighed on the market, even as broader geopolitical risks remained in focus.