International oil prices slipped to their lowest level in over a week on Monday, driven by market expectations of diplomatic progress between the US and Iran during this week's United Nations meetings, while investors also tracked the partial recovery of Saudi oil exports despite ongoing Houthi attacks.
Both Brent crude futures and WTI crude futures touched their lowest levels since September 10 in early Monday trading. As of the time of writing, Brent crude fell 2.19% to $101.60 per barrel, while WTI crude declined 2.20% to $93.97 per barrel. Tim Waterer, chief market analyst at KCM Trade, noted that "the market is hopeful that a diplomatic path could emerge this week to de-escalate the US-Iran conflict, so a portion of the risk premium in oil prices is being removed." He added, "Whether this hope holds up is another question. Time will tell." A Singapore-based brokerage observed that WTI crude broke below the key psychological support level of $100 per barrel, with some investors possibly rolling positions to November contracts a day before the October contract expires.
Diplomatic Hopes Amid Persistent Threats
Iran and the US exchanged new threats on Sunday, with the standoff showing no signs of resolution. Reports indicate that US President Donald Trump, in an interview on Sunday, stated that Washington is in a "decision-making phase" regarding Iran and that something "very significant" would happen "soon." Trump outlined options on the table, including "completely destroying Iran," allowing its economy to deteriorate further, or reaching an agreement. However, he also expressed willingness to meet with Iranian President Masoud Pezeshkian, who is expected to attend the UN General Assembly in New York this week.
Reports also emerged that Iran's security chief, Mohsen Rezaei, said in a Saturday interview that Tehran had conveyed a formal list of conditions aimed at ending the war to the US through mediator Qatar. Majid Al-Ansari, a spokesperson for Qatar's foreign ministry, stated on Sunday that Qatar remains in contact with both Washington and Tehran to push for the resumption of negotiations. Yet, tensions in the Middle East remain exceptionally high. Iran-backed Yemeni Houthi forces claimed responsibility for striking "sensitive" locations in the Saudi capital Riyadh with missiles and drones on Saturday, along with an attack on a Saudi Aramco facility in the Red Sea city of Yanbu, a critical oil export hub.
Saudi Oil Exports Partially Restored
The Houthi attacks on Saudi Aramco's East-West pipeline prompted the state-owned energy giant to increase exports through the Strait of Hormuz this month and next, after it had suspended some shipments via Yanbu. According to preliminary data from analytics firm Kpler, this has helped OPEC leader Saudi Arabia's exports recover to over 4 million barrels per day so far in September, compared with a plunge to 2.4 million barrels per day in August—the lowest level since at least 2013.
JPMorgan analysts stated in a September 18 report that "despite disruptions to Saudi's East-West pipeline, Middle East oil flows have remained surprisingly robust." They noted that total oil flows averaged 17.1 million barrels per day over the past ten days, just 6.1 million barrels per day below the 2025 average. The analysts highlighted that "the most notable shift comes from Saudi Arabia." Satellite data shows that Saudi oil flowing through the Strait of Hormuz averaged 2.9 million barrels per day over the past six days, compared to just 0.7 million barrels per day in August. Daniel Takiddin, co-founder and CEO of Sky Links Capital Group, expects oil prices to remain closely tied to the pace of export normalization and diplomatic progress. He added, "Any setbacks or further deterioration in shipping conditions would tighten the physical market and restore upward pressure on prices."