Oil prices declined nearly 2% at settlement on Friday, September 26, 2026, due to growing hopes of a possible agreement between the US and Iran. This development occurred alongside discussions in Washington about potentially imposing a ban on diesel exports. Despite these factors, concerns persisted regarding the impact of Houthi attacks on Saudi Arabia's oil supplies in the region.
On Friday, Brent crude oil dropped $2.28, or 2.1%, to settle at $104.32 per barrel. Similarly, West Texas Intermediate (WTI) crude fell $2.20, or 2.3%, to $92.41 per barrel. Throughout the week, Brent saw a slight increase of less than 1%, whereas WTI experienced an 8% decline. These price movements reflect the market's sensitivity to geopolitical developments and supply concerns.
According to informed sources, US-Iranian negotiations are exploring the possibility of a gradual resolution to the conflict. This potential agreement could involve reopening the Strait of Hormuz and the US lifting economic sanctions imposed on Iran. However, an Iranian official emphasized that Tehran does not intend to compromise on its nuclear program, even if an agreement is reached on reopening the Strait.
Analysts at Riterbush & Associates noted that the energy markets are facing new pressures due to the ongoing assessment of a potential US ban on diesel exports. Meanwhile, indicators of diplomatic progress regarding the Strait of Hormuz have led to increased selling activity. In related news, the premium of Brent crude over WTI reached its highest level since May.
In terms of oil supplies, Saudi Arabia is preparing for a meeting with leaders from its military, Turkey, and Pakistan. The discussions aim to explore ways to support Saudi Arabia in its confrontation with Houthi attacks. Data from Kpler showed that crude oil flows through the Strait of Hormuz reached 33.7 million barrels during the week starting on September 20.
In Russia, drone attacks caused damage to the Novoshakhtinsk refinery, leading to a temporary suspension of operations. Furthermore, diplomatic efforts continue to end the Russian-Ukrainian conflict, including potential arrangements in the energy sector. Such agreements could enable Russia to increase its oil exports.
The ongoing developments in global oil markets reflect a complex interplay of factors, including geopolitical tensions, supply concerns, and diplomatic efforts. As the situation continues to evolve, market participants remain cautious, monitoring any changes that could impact oil prices and supply chains.
Key points
- Oil prices declined nearly 2% due to growing hopes of a US-Iranian agreement.
- Brent crude settled at $104.32 per barrel, while WTI fell to $92.41 per barrel.
- Diplomatic efforts continue to address global oil supply concerns amid ongoing geopolitical tensions.
