Oil Prices Fall, Brent Turns Negative for the Week as Mideast Supply Fears Abate

Oil prices fell on Thursday, with the global benchmark turning negative for the week, as investor concerns over significant supply disruptions in the Middle East began to subside. The move lower was driven by reports of progress in restarting a critical Saudi Arabian pipeline and signs of potential diplomatic de-escalation between the United States and Iran.

Thursday's Market Moves

By late afternoon trading, Brent crude futures for November delivery had slipped 1.7% to $104.04 a barrel, placing the contract down 0.3% for the week, according to data from Investing.com. The U.S. benchmark, West Texas Intermediate (WTI) crude futures for October, fell 1.3% to $101.05 a barrel.

Despite the session's decline, both benchmarks remained above the key $100 per barrel level. This reflects a lingering geopolitical risk premium as traders continue to monitor the volatile situation in the region.

Saudi Pipeline and Supply Outlook

The reversal comes after prices surged earlier in the week following the shutdown of Saudi Arabia's crucial East-West Pipeline last Friday. The pipeline is a key alternative for shipping crude that avoids the Strait of Hormuz, a major chokepoint for global oil transit.

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However, supply fears were tempered by several developments:

• U.S. Energy Secretary Chris Wright said on Tuesday that the pipeline would resume operations "very soon."
• Bloomberg News reported on Wednesday, citing a person familiar with the matter, that Saudi Arabia was aiming to restart the pipeline at half capacity within days.
• Reuters reported that the kingdom was compensating for the shutdown by offering more crude to Asian refiners via ship-to-ship transfers off the coast of Oman.

Diplomatic Signals Ease Tensions

Market sentiment was also bolstered by an apparent easing of military tensions between the U.S. and Iran. U.S. President Trump remarked on Wednesday that "Iran is very much wanting to make a deal."

Adding to the diplomatic overtures, several media outlets reported that the U.S. State Department had granted visas to top Iranian officials to attend the United Nations General Assembly meeting in New York. These signs of dialogue have reduced the immediate perceived threat of a wider conflict that could severely disrupt oil flows from the Gulf.