Oil Prices Fall Amid Easing Supply Concerns and Regional De-escalation Hopes

Oil prices continued their decline Thursday, influenced by reports easing concerns about Middle East supply disruptions. By 00:49 GMT, Brent crude futures fell $1.24 (1.2%) to $104.59 per barrel; U.S. West Texas Intermediate (WTI) crude futures dropped $1.14 (1.1%) to $101.29. Both contracts had fallen about $3 Wednesday, according to Reuters. Saudi Aramco is repairing a damaged 1,200-kilometer section of its "East-West" pipeline. It aims to restore half its operational capacity within days and full capacity within six weeks, Bloomberg reported, citing an informed source. The pipeline previously transported 4-5 million barrels daily—4-5% of global supplies—before Saudi Arabia halted it preemptively after being targeted. Successful partial restart is expected to ease short-term supply shortage risks, potentially pressuring Brent crude prices, which rose sharply due to supply disruptions. Hiroyuki Kikukawa, General Manager of Research at Nissan Securities Investment, stated, "Concerns about tight supply have slightly receded. Expectations of progress towards de-escalating Middle East tensions before the upcoming U.S.-China summit are also capping price gains." Oil prices had reached their highest levels in approximately four months earlier this week. Despite today's oil price decline, concerns persist regarding escalating tensions in the Middle East. Separately, the U.S. Energy Information Administration announced Wednesday that crude oil inventories fell less than expected last week. Data showed a decrease of about 640,000 barrels, against Reuters' expectations of a 1.62 million barrel draw.