Oil falls as Russian diesel supply prospects counter Gulf supply risks
USO•Brent fell 1.1% to $105.47 a barrel and U.S. WTI dropped 1.3% to $92.57 as traders weighed potential Russian diesel supplies against risks to Gulf energy infrastructure and shipping. OPEC lowered its oil demand growth forecast for the year to 400,000 barrels per day from 1.4 million bpd.
1. Oil prices retreat
Brent crude futures fell $1.18, or 1.1%, to $105.47 a barrel, while U.S. West Texas Intermediate futures dropped $1.17, or 1.3%, to $92.57 by 0625 GMT on Tuesday. Both benchmarks had climbed nearly $2 a barrel in the previous session.
2. Supply risks remain
Traders weighed the prospect of additional Russian diesel supplies after U.S. President Donald Trump said Russia had agreed to supply diesel to global markets and his administration temporarily lifted U.S. sanctions on Russian fuel. Lawmakers from both parties said the agreement appeared to violate U.S. law barring imports of Russian energy until Moscow ends its aggression against Ukraine. Attacks on Saudi Arabia and reported tanker attacks near the Strait of Hormuz kept concerns about Gulf energy infrastructure and shipping in focus.
3. OPEC cuts demand forecast
OPEC lowered its forecast for oil demand growth this year to 400,000 barrels per day from 1.4 million bpd at the start of the year. OPEC and non-OPEC ministers said shipping and insurance costs had risen to more than one-third of commodity value, impeding the movement of crude oil and products.
