LONDON: Oil prices rose on Wednesday after US President Donald Trump denied reports that Washington was prepared to ease sanctions on Iran, while Qatar called for renewed diplomatic efforts between Tehran and Washington.
Brent November futures, which expire on Wednesday, gained 71 cents, or 0.69 per cent, to $103.30 a barrel. The more active December contract rose 35 cents to $96.51. US West Texas Intermediate (WTI) crude increased 43 cents, or 0.48pc, to $89.81.
Brent is on track for a monthly gain of around 14pc, its strongest monthly increase since July, while WTI is heading for a roughly 4pc rise after briefly exceeding $106 a barrel, its highest level since May.
The spread between the two benchmarks also widened to its highest level in four months as traders assessed potential US restrictions on diesel exports. Such restrictions could increase domestic diesel supplies and encourage US refiners to reduce crude processing.
Trump is reportedly considering allowing exports of red-dyed diesel rather than imposing a complete export ban, a move aimed at easing fuel prices ahead of the November midterm elections.
“Continued uncertainty over sanctions relief and negotiations is keeping a geopolitical risk premium embedded in prices,” said Sugandha Sachdeva, founder of New Delhi-based research firm SS WealthStreet.
She added that improving supplies could limit further price gains, while renewed disruptions or an escalation in regional tensions could trigger another rally.
Trump rejects sanctions-relief report
Qatar said on Tuesday that it hoped shuttle diplomacy between Iran and the United States could produce a breakthrough in negotiations.
Trump, however, denied an Axios report citing US officials as saying he was prepared to provide Iran with sanctions relief and release frozen Iranian funds in exchange for “concrete” steps by Tehran on its nuclear programme.
The conflicting signals have kept geopolitical uncertainty elevated in the oil market, even as physical crude supplies from the Middle East continue to recover.
Saudi Arabia has resumed oil tanker loadings from its Red Sea port of Yanbu after restoring operations on the East-West Pipeline.
Crude exports from Middle Eastern producers rose to 16.328 million barrels per day in September, the highest level since the US-Israeli war with Iran began in late February.
“With flows through the Saudi East-West pipeline restored, regional exports are now just 11% below pre-war levels — a remarkable recovery for a region still at war,” J.P. Morgan Research said in a note.
The bank estimated that the 10-day average of total oil exports over the past five days stood at 20.5 million barrels per day, equivalent to 89pc of 2025 levels.
US inventories in focus
In the United States, crude oil and gasoline inventories increased last week, while distillate stocks declined, according to data from the American Petroleum Institute cited by market sources.
Official inventory figures from the US Energy Information Administration were due later on Wednesday.
Analysts polled by Reuters were expecting US crude and petroleum product inventories to have declined, potentially providing further direction to oil prices.
By Reuters
