Oil holds near two-week lows while diesel cracks hit record peak

Business Recorder reported that oil prices stayed close to their weakest levels in over a fortnight on Wednesday, as greater crude availability from the Gulf pressed on prices. Brent futures inched higher by 37 cents, reaching $99.62 a barrel at 0958 GMT, while WTI slipped 44 cents to $90.08. Diesel refining margins, however, climbed to a record as speculation grew over possible curbs on US diesel exports.

Trump's backing of a diesel export ban, aimed at lowering prices that have reached record highs amid a global supply shortage, pushed the premium of European low-sulphur gasoil over Brent to a record of about $95 a barrel. Europe relies heavily on US diesel and jet fuel imports since the war on Iran by the US and Israel disrupted Middle East supplies. Analysts, however, cautioned that such a measure would barely ease energy costs and could deepen supply and economic strains worldwide.

Supply signals pointed in both directions. Saudi Arabia restarted its East-West pipeline to the Red Sea, which had been shut on September 11 after drone attacks, and Iraq said its exports exceeded 3 million bpd. Yet US crude stocks grew by 1.8 million barrels during the seven days ending September 18, against analysts' expectations of a decline, and the US Energy Information Administration's weekly data is due later in the day.