EMEA Oil Update: Brent Futures Extend Fall for 3rd Straight Day

Brent crude futures fell for a third straight session on Tuesday as President Donald Trump signaled potential talks with Iran, though analysts warn that depressed Persian Gulf flows and Red Sea security risks will keep a heavy risk premium in the market.

The Brent futures contracts extended decline by 2.7% to $86.04 per barrel. Murban closed at $84.43/bbl on July 27 and was not trading by the time of publication of this oil price update.

"Oil prices continue to sell off with recent developments pointing towards further de-escalation. However, for now, there is still no pickup in Persian Gulf oil flows," ING said.

Trump said Monday Iran has requested talks after recent US military strikes, signaling a possible deal. "They want to meet, and we're meeting," Trump spoke during a press gaggle aboard Air Force One.

"There's a chance we can make a deal. Without what we did, they wouldn't even be talking to us," Trump said.

Despite diplomatic de-escalation prospects, physical supply bottlenecks continue to underpin market caution.

"If this move lower is to be sustained, we will need to see a recovery in flows through the strait. Furthermore, even in the event of a deal, one would expect that the market will need to continue to price in a large risk premium, given that recent events have demonstrated how quickly a deal can unravel," ING added.

Compounding regional supply uncertainties, trade flows face persistent threats.

According to Kpler, Saudi crude exports moving through the Bab el-Mandeb Strait have dropped sharply following weekend Houthi attacks targeting Saudi oil infrastructure and shipping lanes.

Prior to the July 22 attacks, Saudi west coast crude shipments from Yanbu averaged roughly 3 million barrels per day, Kpler noted.

On the supply side, weekly US crude inventory data from the Energy Information Administration is forecast to show a 6.1-million-barrel draw for the week ending July 24, Macquarie strategists said in a weekly note on Monday, following a 2 million-barrel build the previous week.

The market now awaits official crude inventory data due on Wednesday from the US EIA.

US Oil Update: Futures Retreat as Middle East, Black Sea Supply Risks Recede

Crude futures plunged in after-hours trading on Monday, pulling back from a multi-session high, as immediate supply threats across key Middle Eastern and Black Sea crude exporting markets began to ease.Front-month West Texas Intermediate crude futures retreated 8.3% to $81.88 per barrel, while Brent futures plunged by 9% to $87.75/bbl.EBW Analytics strategists said on Monday that the market could return to an oversupplied balance if hostilities continue to ease, though risks remain elevated given the potential for the conflict to broaden.The US has held off on new military strikes against Iranian targets since Friday, following 13 straight nights of attacks aimed at degrading Tehran's ability to disrupt commercial shipping in the Strait of Hormuz.Iran, in response, reportedly signaled that it would stop carrying out attacks on its Gulf neighbors as long as the US also refrains from striking, as Tehran held talks with Oman over the Strait of Hormuz.On Monday, the US Central Command said that Washington's ongoing blockade against Iran has redirected 17 commercial vessels, disabled two, and boarded two to enforce compliance.Earlier on Monday, Iran's Foreign Ministry spokesman, Esmail Baghaei, said that while "it's possible that mediators share messages from the US side about current developments," no formal peace negotiations between Iran and the US are currently taking place.He said talks between Tehran and Muscat have no connection whatsoever with the US and are ongoing.However, Saudi Arabia's Ministry of Defense on Monday intercepted drones from Iraq and Yemen's Houthis targeting its oil facilities.Soojin Kim, research analyst at MUFG, said that although the pause in US military action has eased immediate supply fears, constrained maritime traffic across key export routes suggests geopolitical risk remains elevated.The defense ministry said in a social media post that the Gulf state's air defenses intercepted and destroyed several drones that targeted petroleum facilities in the country's Eastern Province and Riyadh region.On Monday, the Houthis also said they launched drone attacks on Saudi Arabian oil infrastructure in response to incursions by the Gulf state's drones.Yahya Saree, the Houthis' spokesperson, said that several targets in the supply and transport of crude oil from eastern Saudi Arabia to Yanbu were struck by several drones.Saudi Arabia has re-routed its crude output to Yanbu via its east-west pipeline to get around Iranian attacks on shipping in the Hormuz.Meanwhile, traffic through the Hormuz, through which 20% of the world's oil and liquefied natural gas supplies flowed before the conflict, remains restricted, with the latest shipping data showing only 29 confirmed crossings between July 24 and 26.Bab el-Mandeb, by comparison, recorded 100 verified crossings, with 51 vessels entering the Red Sea and 49 exiting.

Saudi Crude Transit Through Bab el-Mandeb Drops Sharply After Houthi Attacks, Kpler Says

Saudi crude exports continue to move through the Bab el-Mandeb Strait despite a sharp drop in transit volumes following Houthi attacks, Kpler said in a Monday note.Before the July 22 attacks, crude cargoes loaded at Saudi Arabia's west coast averaged about 3 million barrels per day through the strait, reflecting regular shipments from Yanbu to Asia.Kpler said the attacks marked an escalation in Houthi targeting of Saudi-linked shipping in the Red Sea.Since July 22, only six Saudi-loaded crude tankers have crossed Bab el-Mandeb, with transit volumes averaging about 1.5 million b/d over the six days after the attacks.The transit volumes have dropped by almost 50%, although Saudi crude exports have not stopped, according to Kpler.Kpler said it has not confirmed any suspension of Saudi crude loadings from Yanbu or vessel crossings through the strait.The firm said the shipping corridor remains open even as traffic continues at a slower pace.

EMEA Oil Update: Brent Futures Extend Fall for 3rd Straight Day

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US Oil Update: Futures Retreat as Middle East, Black Sea Supply Risks Recede
Crude futures plunged in after-hours trading on Monday, pulling back from a multi-session high, as immediate supply threats across key Middle Eastern and Black Sea crude exporting markets began to ease.Front-month West Texas Intermediate crude futures retreated 8.3% to $81.88 per barrel, while Brent futures plunged by 9% to $87.75/bbl.EBW Analytics strategists said on Monday that the market could return to an oversupplied balance if hostilities continue to ease, though risks remain elevated given the potential for the conflict to broaden.The US has held off on new military strikes against Iranian targets since Friday, following 13 straight nights of attacks aimed at degrading Tehran's ability to disrupt commercial shipping in the Strait of Hormuz.Iran, in response, reportedly signaled that it would stop carrying out attacks on its Gulf neighbors as long as the US also refrains from striking, as Tehran held talks with Oman over the Strait of Hormuz.On Monday, the US Central Command said that Washington's ongoing blockade against Iran has redirected 17 commercial vessels, disabled two, and boarded two to enforce compliance.Earlier on Monday, Iran's Foreign Ministry spokesman, Esmail Baghaei, said that while "it's possible that mediators share messages from the US side about current developments," no formal peace negotiations between Iran and the US are currently taking place.He said talks between Tehran and Muscat have no connection whatsoever with the US and are ongoing.However, Saudi Arabia's Ministry of Defense on Monday intercepted drones from Iraq and Yemen's Houthis targeting its oil facilities.Soojin Kim, research analyst at MUFG, said that although the pause in US military action has eased immediate supply fears, constrained maritime traffic across key export routes suggests geopolitical risk remains elevated.The defense ministry said in a social media post that the Gulf state's air defenses intercepted and destroyed several drones that targeted petroleum facilities in the country's Eastern Province and Riyadh region.On Monday, the Houthis also said they launched drone attacks on Saudi Arabian oil infrastructure in response to incursions by the Gulf state's drones.Yahya Saree, the Houthis' spokesperson, said that several targets in the supply and transport of crude oil from eastern Saudi Arabia to Yanbu were struck by several drones.Saudi Arabia has re-routed its crude output to Yanbu via its east-west pipeline to get around Iranian attacks on shipping in the Hormuz.Meanwhile, traffic through the Hormuz, through which 20% of the world's oil and liquefied natural gas supplies flowed before the conflict, remains restricted, with the latest shipping data showing only 29 confirmed crossings between July 24 and 26.Bab el-Mandeb, by comparison, recorded 100 verified crossings, with 51 vessels entering the Red Sea and 49 exiting.

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Saudi crude exports continue to move through the Bab el-Mandeb Strait despite a sharp drop in transit volumes following Houthi attacks, Kpler said in a Monday note.Before the July 22 attacks, crude cargoes loaded at Saudi Arabia's west coast averaged about 3 million barrels per day through the strait, reflecting regular shipments from Yanbu to Asia.Kpler said the attacks marked an escalation in Houthi targeting of Saudi-linked shipping in the Red Sea.Since July 22, only six Saudi-loaded crude tankers have crossed Bab el-Mandeb, with transit volumes averaging about 1.5 million b/d over the six days after the attacks.The transit volumes have dropped by almost 50%, although Saudi crude exports have not stopped, according to Kpler.Kpler said it has not confirmed any suspension of Saudi crude loadings from Yanbu or vessel crossings through the strait.The firm said the shipping corridor remains open even as traffic continues at a slower pace.