Asia, Sep 17 : Oil prices declined in early Asian trading on Thursday, extending losses from the previous session as fresh reports of additional Saudi Arabian crude supplies through Oman eased concerns about disruptions to global energy markets.
Brent crude futures fell $1.24, or 1.2%, to $104.59 a barrel by 0049 GMT. U.S. West Texas Intermediate (WTI) futures declined $1.14, or 1.1%, to $101.29 a barrel. Both benchmarks had dropped by around $3 on Wednesday.
Market sentiment improved after reports that Saudi Arabia was arranging additional crude shipments to Asian refiners through ship to ship transfers off Oman’s Sohar port. The move is expected to partially offset supply losses linked to recent attacks on the kingdom’s East-West pipeline, which carries crude toward the Red Sea.
Hiroyuki Kikukawa, chief strategist at Nissan Securities Investment, said concerns over tighter supplies had eased somewhat following reports of Saudi crude shipments through Oman. He also said expectations of progress in reducing tensions in the Middle East ahead of a U.S.- China summit scheduled for next week were limiting upward pressure on prices.
The developments come after crude prices climbed to around four month highs earlier this week. Shipping industry sources had reported that Saudi Arabia suspended crude loadings at its Red Sea export hub of Yanbu and cancelled some deliveries to European buyers following attacks on the East-West pipeline.
Yanbu has become particularly important to Saudi oil exports amid the disruption around the Strait of Hormuz. Iran began blockading the key waterway after U.S. and Israeli attacks on the country at the end of February. Before the conflict, the Strait of Hormuz carried roughly one-fifth of global oil supplies.
Two pumping stations connected to the East-West pipeline were damaged in an attack last week. Oil and security sources said the timeline for repairs remains uncertain, adding to concerns about the reliability of alternative export routes.
Despite Thursday’s decline, market participants remain cautious as military tensions across the Middle East continue to threaten energy infrastructure and shipping routes.
Saudi warplanes carried out strikes in Yemen, while Houthi fighters reported launching drones and missiles toward Saudi cities on Wednesday. The Iran-backed group said the latest developments followed a rapid advance that has expanded Tehran’s influence within the wider regional conflict.
Meanwhile, U.S. crude inventory figures provided another bearish signal for prices. The Energy Information Administration reported that crude stocks in the United States fell by about 640,000 barrels last week, significantly less than the 1.62 million barrel decline expected by analysts in a Reuters poll.
The smaller than expected inventory draw suggested that U.S. oil demand and supply conditions may be less supportive than previously anticipated, adding another factor weighing on crude prices.