Oil falls as Russian diesel supply prospects counter Gulf supply risks

Global oil benchmarks slipped on Tuesday, according to The Express Tribune, as traders weighed Gulf supply risks against the prospect of extra Russian diesel. Brent crude lost $1.18, or 1.1%, to $105.47 a barrel by 0625 GMT, while US West Texas Intermediate fell $1.17, or 1.3%, to $92.57.

Both contracts had gained close to $2 a barrel in the previous session, with Brent reaching its highest since September 15. President Donald Trump announced that Moscow would provide diesel to global buyers and that Washington had eased sanctions on Russian fuel for now. ING analysts, however, remained sceptical of the Russia-Ukraine energy ceasefire, pointing to reports of Russian strikes on Ukrainian energy sites since it was announced.

Worries about the safety of Gulf energy assets and sea routes stayed prominent after Houthi forces hit the airport in Riyadh at the weekend, with reports of tanker strikes around the Strait of Hormuz. KCM Trade chief analyst Tim Waterer said the market was still more focused on possible hits to vessels and pipelines across the Gulf than on additional barrels, and he had not yet seen signs that tensions were easing. Separately, OPEC lowered its oil demand growth estimate to 400,000 barrels daily, against 1.4 million bpd when the year began.