Oil prices ease after Trump downplays risk of Iran strikes

Global crude oil prices declined on Monday, 9 November, as US President Donald Trump indicated that further military action against Iran was unlikely. The market reaction followed remarks suggesting a reduced probability of renewed attacks, provided diplomatic efforts to resolve the ongoing conflict continued. This development offered a temporary reprieve to energy markets, which had been volatile due to escalating geopolitical tensions in the Middle East.

By 08:30 GMT, Brent crude had fallen by $1.65, representing a 1.7% decrease, to trade at $96.67 a barrel. US West Texas Intermediate (WTI) also retreated, dropping by $0.96, or 1%, to $89.87. These moves followed a significant weekly decline for the Brent benchmark, which slid by 16% in the previous week. That loss marked the sharpest weekly drop for the benchmark since the onset of the COVID-19 pandemic, reflecting intense market anxiety over potential supply disruptions.

The recent price volatility was driven by a series of incidents threatening energy infrastructure and shipping routes. Both the US and Iran have reported attacks on vessels in or near the Strait of Hormuz, a critical global oil transit corridor. Iranian officials have warned of retaliation against US and Israeli targets if military escalation continues. Additionally, Iran-aligned Houthi forces stated on Sunday that they had carried out an attack on Saudi Aramco offices in Riyadh, further heightening regional security concerns.

Disruptions have also affected production in Russia and Iraq. In Russia, the Kirishi oil refinery was set on fire following a reported Ukrainian drone strike on Monday, according to Governor Alexander Drozdenko. Meanwhile, in Iraq, production at the Khor Mor gas field in the Kurdistan region was halted after a drone struck an LPG storage tank on Sunday. The resulting fire continued into Monday, causing power generation in the region to drop by approximately 2.8GW. Iraqi Prime Minister Ali al-Zaidi stated that initial assessments indicated no casualties from the attack. Shipping through the Strait of Hormuz remains disrupted, affecting countries including Iraq, while no group has claimed responsibility for the latest drone attack on the Khor Mor facility.