Oil Prices Rise for Second Straight Session Amid Ongoing Middle East Supply Concerns

Russia, Sep 29 : Oil prices climbed for a second consecutive session on Tuesday, with concerns over potential disruptions to Middle East supplies continuing to support the market despite signs that crude shipments from the region are recovering.

Brent crude futures gained 63 cents, or 0.6%, to $105.91 a barrel by 0002 GMT. US West Texas Intermediate (WTI) crude rose 72 cents, or 0.8%, to $93.32 a barrel.

KCM Trade chief analyst Tim Waterer said rising oil exports from the Gulf were providing a clearer indication of improving supply flows, although a significant portion of the increase was being facilitated through ship to ship transfers. Such arrangements are more expensive and less efficient than conventional shipping operations, keeping crude prices at elevated levels.

Preliminary data from energy data provider Kpler showed crude exports from major Middle Eastern producers reached 12.8 million barrels per day in September, the highest level since February. Higher shipments from Saudi Arabia and the United Arab Emirates contributed to the increase.

Market attention also remained focused on diplomatic efforts to end the seven-month conflict between the United States and Iran. Officials from Washington and Tehran held separate discussions with mediators as efforts to revive negotiations continued.

The talks are expected to centre on a revised version of a seven day proposal put forward by Iran last week on the sidelines of the United Nations General Assembly.

Waterer said expectations of a potential diplomatic breakthrough were limiting the upward movement in Brent prices. He noted that traders were weighing improving export volumes against continued geopolitical risks as they assessed the direction of the market.

The conflict, which began in late February following US and Israeli attacks on Iran, has intensified scrutiny of the Strait of Hormuz. The strategic waterway is a major transit route for global oil and gas supplies, and any prolonged disruption could have significant consequences for international energy markets.

Meanwhile, the United States is considering regulatory changes that could permit wider sales of red dyed diesel in an effort to ease fuel prices, according to people familiar with the discussions.

The measure could enable some consumers to avoid the federal fuel tax and has emerged as a leading alternative to a proposed restriction on diesel exports. US officials have been weighing the options as concerns over domestic fuel costs persist.