Oil Prices Drop Amid Hopes for Ending Middle East and Ukraine Conflicts - Sarmad

Oil prices fell by more than a dollar on Thursday, amid hopes for an end to the Middle East conflict and the war between Russia and Ukraine.

By 0141 GMT, Brent crude futures dropped $1.14, or 1.2 percent, to $91.62 a barrel. U.S. West Texas Intermediate (WTI) crude futures also fell $1.04, or 1.2 percent, to $85.49 a barrel.

Brent crude rose about 1.4 percent and U.S. crude rose 0.6 percent on Wednesday, after both recorded their lowest levels in two months in the previous session.

Hiroyuki Kikukawa, senior analyst at Nisay Securities Investment, said markets are declining due to expectations that behind-the-scenes efforts are underway to reach a ceasefire between Russia and Ukraine, and that the risk of an escalation of the war with Iran ahead of the U.S.-China summit scheduled for next week is being ruled out.

Kikukawa added, “However, given the uncertainty surrounding the Strait of Hormuz, a significant market decline is unlikely.”

Russian and Ukrainian negotiators agreed on a major prisoner exchange during two days of talks in Abu Dhabi, which concluded on Wednesday. U.S. mediators said disagreements remain on other key issues, including territory.

Ukrainian President Volodymyr Zelensky said Kyiv hopes to achieve tangible results on ending the war this year. Meanwhile, Mohsen Rezaei, secretary of Iran’s Supreme National Security Council, told Al-Mayadeen TV that Tehran will not allow even a single grain of enriched nuclear material to leave the country, warning of consequences if the United States launches new strikes.

Washington stated that nuclear issues must be part of any preliminary negotiations with Iran aimed at ending the eight-month-long war, while U.S. officials downplayed the need for further military strikes.

Crude oil production in OPEC+ countries jumped in October, driven by a sharp increase in Saudi output despite ongoing disruptions to shipments through the Strait of Hormuz.

Market sources, citing data from the American Petroleum Institute, reported that U.S. crude inventories rose by 9 million barrels last week.

Official data from the U.S. Energy Information Administration is scheduled for release on Thursday, after being delayed by one day due to a national holiday in the United States on Wednesday.