Oil slips as Middle East crude exports rise, G7 to release stocks

NEW YORK: Oil prices slipped on Monday as rising crude exports from the Middle East and a release of oil stocks from Group of Seven nations added to supplies despite ongoing concerns about further damage to Gulf oil infrastructure amid the Iran war.

Brent crude futures fell 35 cents, or 0.34 per cent, to US$101.90 a barrel by 0115 GMT, while US West Texas Intermediate crude was at US$90.49 a barrel, down 62 cents, or 0.68 per cent.

Brent gave up most of its gains last week while WTI was 1.6 per cent lower after G7 countries agreed on Friday to release 100 million barrels of diesel and crude from emergency reserves and pledged to refrain from energy export restrictions after pressure from US President Donald Trump.

The release will add to Middle Eastern crude exports, which rose above pre-war levels in four of the seven days of the final week of September, shipping data showed on Monday, despite attacks on vessels passing through the Strait of Hormuz.

"The G7 decision to tap strategic reserves is taking some of the immediate supply anxiety out of the price, while there's a growing view that Saudi export volumes are moving back toward pre-war levels, even if those barrels are still moving at higher cost and via less efficient routes," said Tim Waterer, chief analyst at KCM Trade.

"That combination is enough to subdue prices for now even though the risks of further damage to energy infrastructure around the Gulf region haven't gone away."

The Houthis said they launched ballistic missiles and drones at Saudi Aramco sites in Riyadh and the Khurais area of Saudi Arabia in response to 50 Saudi-led air and missile strikes in Yemen in the past 12 hours. There was no confirmation from Saudi Arabia.

On Sunday, Yemen's Saudi-backed, internationally recognised government said it was launching a major military campaign to recapture all areas of the country controlled by the Iran-backed Houthis. Meanwhile, Aramco has unexpectedly cut November crude oil prices for Asia to six-year lows.

OPEC+ delayed a review that would determine 2027 oil output quotas for its members after the US-Israeli war on Iran disrupted projects to expand capacity across the Middle East, throwing estimates of future production potential into uncertainty, said two sources close to the matter.

In Europe, Ukraine will double down on attacking Russian oil refineries, Ukrainian President Volodymyr Zelenskiy told Reuters in an interview published on Saturday.