Brent oil slips as US weighs easing sanctions on global 'shadow fleet'
USO•Brent crude fell 1.42% to $104.55 a barrel as investors weighed potential US steps to ease restrictions on the global “shadow fleet.” US West Texas Intermediate rose 0.76% to $95.81, likely on expectations of a large weekly US inventory draw.
1. Oil prices diverge
Brent crude fell $1.51 to $104.55 a barrel by 9:58 a.m. EDT, while US West Texas Intermediate rose 72 cents to $95.81. Investors were watching potential US steps to allow “legal oil” to flow on previously sanctioned vessels, which could ease vessel tightness and freight rates, a US official said.
2. Shipping risks persist
Attacks on ships near the Strait of Hormuz and escalating conflict between Saudi Arabia and Yemen’s Houthis curbed Brent’s decline. A container ship and a dry bulk carrier sank near the strait after separate projectile strikes, maritime officials said. Iran said it was stepping up strikes in response to a US blockade of its ports and tougher sanctions.
3. Supply developments
Ukraine resumed attacks on Russian refineries with a strike on a plant in the Ryazan region. Spain plans to release 4.4 million barrels from strategic reserves in October, while the International Energy Agency began a meeting expected to clarify details of a 100-million-barrel stock release. US inventory figures were due later on Thursday.
