Oil falls as diplomacy hopes outweigh Middle East escalation fears

Oil benchmarks retreated on Thursday as renewed diplomatic activity eased some concern about supply risks from the Middle East, Business Recorder reported. By 1314 GMT, Brent had dropped $1.55, or 1.34%, to $113.77 a barrel, while US West Texas Intermediate was down $2, or 1.95%, at $100.78. Both contracts had risen in the previous session, with Brent up 1.3% and WTI gaining 3%.

Efforts to restart negotiations between the United States and Iran, including a draft proposal presented by Qatari mediators, weighed on prices, although Iranian officials disputed the proposal’s acceptability. Attacks and threats involving the Houthis, Iran and Saudi Arabia, along with reports of tankers striking mines near the Strait of Hormuz, kept supply concerns in focus. Expectations of stronger Russian output also limited prices, while US crude and distillate inventories fell and gasoline stocks rose in the week to October 23.