LONDON, Sept 29 — Oil prices were steady on Tuesday as investors focused on lingering concerns over Middle East supply disruption from the United States (US)-Israeli war on Iran and signs of recovering crude exports from the region.
Brent crude futures for November fell ¢24, or 0.23 per cent, to US$105.04 a barrel at 1022 GMT. Meanwhile, US West Texas Intermediate crude was at US$92.24, down ¢36, or 0.36 per cent.
Brent and WTI are headed for monthly gains of around 16 per cent and eight per cent, respectively.
"A clearer picture is emerging of higher oil export volumes leaving the Gulf, but much of that increase still relies on workarounds such as ship-to-ship transfers. Those methods are less efficient and more costly than normal operations, which is why crude prices remain elevated," said KCM Trade chief analyst Tim Waterer.
Preliminary figures from data provider Kpler on Monday showed that crude exports from major Middle Eastern producers climbed to 12.8 million barrels a day in September, the highest since February, which was helped by increased shipments from Saudi Arabia and the United Arab Emirates.
Meanwhile, officials of both countries said that US and Iranian officials spoke separately with mediators in a renewed effort to end seven months of war.
But US President Donald Trump said he has offered Iran nothing to end the war, rejecting media reports that cited US officials saying he was willing to ease sanctions and release frozen funds for "concrete" steps regarding Iran's nuclear programme.
Meanwhile, people familiar with the discussions told Reuters that Washington is considering regulatory relief to allow broader sales of red-dyed diesel to help lower prices. The proposal emerged as a leading alternative to a diesel export ban.
"The flashes (of a possible rapprochement between the US and Iran) across media are wishful thinking rather than concrete deals.
"If it were not so, why is the US President still pondering a diesel/export ban and twiddling with the tax regime on agricultural ‘red’ diesel if he thought petroleum products would be soon flowing forth from the choke points of disruption he has caused via Hormuz and Bab el-Mandeb?"said PVM analyst John Evans.
A preliminary Reuters poll on Monday indicated that US crude oil and gasoline inventories were expected to have fallen last week, while distillate stockpiles were likely unchanged.
