Oil prices ease further as Saudi Arabia offers more crude via Oman

Oil prices fall in early trade, extending the previous day’s losses, as reports of Saudi Arabia offering extra crude cargoes through Oman reduced fears of supply disruptions in the Middle East.

Brent crude futures drop $1.24, or 1.2 per cent, to $104.59 a barrel by 0049 GMT, while US West Texas Intermediate futures down $1.14, or 1.1pc, at $101.29. Both contracts fell about $3 on Wednesday.

“Concerns over supply tightness eased slightly following news that Saudi Arabia would ship cargo via Oman,” says Hiroyuki Kikukawa, chief strategist of Nissan Securities Investment, a unit of Nissan Securities.

“Expectations of progress toward easing tensions in the Middle East ahead of US-China summit next week are also capping price gains,” he added.

Saudi Arabia is offering more loadings of crude oil to Asian refiners via ship-to-ship transfers off Oman’s Sohar port, blunting some of the hit to global supply from attacks on the country’s East-West pipeline to the Red Sea.

“News around Saudi Arabia exporting from the Gulf suggests concerns that the disruption could be larger are easing,” said UBS analyst Giovanni Staunovo.