On October 29, international oil prices declined as market expectations grew that the Middle East conflict could be resolved through diplomatic channels, partially offsetting supply concerns triggered by Houthi attacks on Saudi energy facilities.
As of press time, Brent crude oil futures fell 1.4% to $113.73 per barrel, while U.S. WTI crude oil futures dropped 1.6% to $101.19 per barrel.
Previously, both major crude oil futures prices had risen on Wednesday following the attacks on Saudi energy facilities, and they remain near six-month highs.
U.S.-Iran contacts make new progress, but differences remain significant
The latest information shows that U.S. Vice President Vance has proactively contacted Rezaei, Secretary of Iran's Supreme National Security Council, in an attempt to establish a communication channel for resuming negotiations between the two sides.
U.S. President Trump stated on October 28 that the United States and Iran are conducting negotiations through intermediaries, but he is uncertain whether the talks will yield results.
Meanwhile, Qatari mediators submitted a new draft agreement aimed at ending the conflict to Iran, but an Iranian official considered the proposal unacceptable.
Earlier this week, representatives from Saudi Arabia, Turkey, and Pakistan also held talks with Iranian officials in Tehran.
Despite increased diplomatic contacts among various parties, differences remain and a substantive agreement is still far from being reached.
Military conflict risks limit oil price declines, U.S. crude inventories unexpectedly drop
Although diplomatic negotiations have made progress, the market remains concerned that the United States may launch military strikes against Iran again after the November 3 midterm elections.
At the same time, recent Houthi attacks on Saudi refineries and oil transmission facilities have put energy transport routes beyond the Strait of Hormuz at security risk as well.
If military conflict escalates again, it could further disrupt Middle East crude oil production and exports, limiting the downside for international oil prices.
The decline in U.S. crude oil inventories has also provided some support for oil prices.
Data from the U.S. Energy Information Administration (EIA) shows that commercial crude oil inventories in the United States decreased by 1.9 million barrels to 410.6 million barrels for the week ending October 23, while the market had previously expected a slight increase.
However, gasoline inventories unexpectedly rose by 3.9 million barrels, while distillate inventories fell by 1.5 million barrels, indicating that U.S. refined product demand performance remains mixed.
Comments