Key Notes
- Brent briefly traded below $90 on November 10 for the first time since August.
- The benchmark later stood at $90.40 at 12:14 UTC, while WTI traded at $85.10 as markets assessed Trump’s comments on Iran.
- ING estimates Gulf crude exports have recovered to 80-85% of prewar levels, while refined-product shipments remain at only 35-40%.
Brent crude briefly fell below $90 a barrel on November 10 for the first time since August, extending a selloff as President Donald Trump raised hopes of an end to the Iran conflict and more Gulf oil returned to international markets.
The decline continued a post-election retreat that has stripped away some of the premium traders paid for the risk of another supply disruption. Cheaper oil also helped drive Monday’s stock rally, offering relief from one source of pressure on business costs and inflation.
Brent Rebounds After Breaking $90
Brent later recovered the $90 threshold. At 12:14 UTC, futures were down $2.17, or 2.34%, at $90.40 a barrel, while West Texas Intermediate fell $1.75, or 2%, to $85.10, according to a Reuters update. Those are intraday prices, rather than closing settlements.
The move followed a 5.9% fall in Brent on Monday. Tuesday’s dip was its first below $90 since August 31, Reuters reported, underscoring how quickly the market has reassessed the outlook for Gulf supplies.
Trump’s Comments Ease the War Premium
Trump said on Monday that the conflict could end “fairly soon” after meeting Qatar’s prime minister at the White House, CNBC reported. He also signaled that he would hold off on new strikes following appeals from governments in the region.
Energy consultant Fereidun Fesharaki was less optimistic. Speaking to CNBC on Tuesday, he pointed to disagreements over Iran’s enriched nuclear material and control of the Strait of Hormuz as obstacles to an agreement. The price decline reflects traders’ changing expectations about those negotiations.
Crude Flows Recover Faster Than Refined Fuels
ING (NYSE: ING) strategists Ewa Manthey and Warren Patterson estimate that Persian Gulf crude exports, including pipeline shipments, have recovered to roughly 80-85% of prewar levels. Refined-product shipments have recovered to only about 35-40%.
That gap helps explain why the relief in crude may reach fuel buyers unevenly. Gasoline, diesel and jet fuel require refining capacity as well as available oil. For businesses exposed to airline fuel costs, the price of finished fuel and the cost of delivering it matter alongside the crude benchmark.
The improvement in Gulf shipments is showing up in China’s trade data. ING said October crude imports rose 13% from September to about 42 million tonnes, or 9.9 million barrels a day, helped by recovering Persian Gulf and Iraqi supplies. Imports nevertheless remained about 13% below their year-earlier level.
