Oil prices recovered from earlier losses as attacks on Saudi Arabia raised concerns about global supplies, while US President Donald Trump’s announcement of additional Russian diesel exports raised expectations of more fuel entering international markets.
Brent crude futures rose by 69 cents, or 0.7%, to $105.41 a barrel by 09:23 GMT on Monday, October 12, while US West Texas Intermediate (WTI) crude gained 57 cents, or 0.6%, to $92.42 a barrel, according to Reuters.
The recovery came as investors weighed the possibility of increased Russian diesel supplies against growing security threats to oil production and transportation in the Middle East.
Trump announced on Friday that Russia would immediately supply more than 300,000 metric tonnes of diesel, equivalent to approximately 2.25 million barrels, to the United States and international markets, with further deliveries expected.
The announcement raised expectations that additional Russian fuel could help ease pressure on diesel supplies, which have been affected by disruptions to refining operations and international shipments.
Following Trump’s announcement, ICE gasoil futures fell by 4.3% to $1,419.50 per metric tonne.
However, analysts questioned whether Russia could increase exports as quickly as expected, given the damage sustained by its refining facilities.
PVM analyst Tamas Varga said the immediate impact of the arrangement remained uncertain because Russia’s refining capacity had been significantly reduced.
“The immediate impact of the deal is questionable, as Russia’s refining capacity has been severely reduced,” Varga said.
He added that Moscow had partially lifted its restrictions on diesel exports, allowing approximately 500,000 metric tonnes, equivalent to 3.7 million barrels, to be released onto international markets.
The volume represents roughly one day of diesel consumption in the United States and approximately 13% of global daily demand.
In another development, Trump announced on Sunday that Russia and Ukraine had agreed to suspend attacks on each other’s energy infrastructure.
However, Ukrainian President Volodymyr Zelenskyy said he was still awaiting details of the proposed agreement, while Russian authorities had not publicly commented on the announcement.
Meanwhile, renewed attacks in the Middle East have raised concerns about the security of energy supplies.
The Iran-aligned Houthi movement claimed responsibility for an attack on Riyadh’s international airport on Saturday, October 10, which killed 13 people and injured more than 300 others. Further attacks were reported on Sunday.
The situation was further complicated by attacks on oil tankers travelling through the Strait of Hormuz, a major shipping route for international energy supplies.
According to the United Kingdom Maritime Trade Operations (UKMTO), one tanker was struck by a drone near Sohar in Oman, while another vessel sustained damage while passing through the Strait of Hormuz.
The incidents followed other attacks reported in the region this month, raising concerns that further disruptions could affect the recovery in Middle Eastern crude oil exports recorded in September.
Investment bank Goldman Sachs has also revised its oil price forecasts, reflecting continued concerns about disruptions to global supplies.
The bank raised its Brent crude forecast for December to $90 a barrel from $85, estimating that supply-related risks had added a premium of slightly more than $20 a barrel to oil prices.
Goldman Sachs also projected that WTI crude would average $81 a barrel in December 2026 before declining to an average of $73 in 2027.
Its analysts attributed the unusually wide price difference between WTI and Brent partly to high shipping costs between the United States and Europe.
Elsewhere, major energy companies were working to restore production in the Gulf of Mexico after Hurricane Isaias disrupted offshore operations.
Shell, Chevron and BP were preparing to return personnel to their platforms and resume production after the hurricane made landfall early on Saturday.
The interruptions added to concerns about global oil supplies as markets continued to respond to security threats in the Middle East and reduced refining capacity in Russia.
The International Energy Agency (IEA) has also called for further action to address tightening diesel supplies.
IEA Executive Director Fatih Birol urged member countries that had not fully delivered their previously pledged emergency oil supplies to accelerate the remaining releases, giving priority to diesel.
He also encouraged countries that had fulfilled their commitments to assess whether additional diesel reserves should be released to ease pressure on international markets.
The agency’s governing board is scheduled to meet on October 15 to review the progress of emergency stock releases and consider further measures to address global fuel supply pressures.
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