By Mary Izuaka

 

Oil prices fell to their lowest in 11 days on Monday, sliding towards the $ 100-a-barrel threshold, as traders hoped for diplomatic progress over the Iran war at this week’s United Nations General Assembly and tracked a partial recovery in Saudi shipments.

Brent crude and US West Texas Intermediate, WTI, both touched their lowest since 10 September. Brent for November delivery was at $101.18 a barrel at 12:54 GMT, down $2.69 or 2.6 per cent.

WTI for October delivery, which expires on Tuesday, also fell $2.69 or 2.7 per cent to $97.61 a barrel. The November contract stood at $93.49.

The drop came despite fresh threats between Iran and the United States on Sunday. President Donald Trump said he would be open to meeting Iranian President Masoud Pezeshkian, who is expected in New York for the UN General Assembly.

Iran has conveyed its conditions to mediators for re-engaging in negotiations, Al Jazeera reported, citing Iran’s security chief, Mohsen Rezaei.

Fighting in the Middle East, however, continued. Yemen’s Iran-backed Houthis said they attacked Riyadh and a Saudi Aramco facility in the Red Sea city of Yanbu, as part of a push to cut off the Red Sea coast from areas held by Saudi-backed forces.

Reuters quoted three Iranian sources familiar with the matter as saying that China has asked Iran to help rein in the Houthis after an appeal to Beijing by Saudi Arabia following the attacks.

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The Houthi attacks on Aramco’s East-West pipeline have prompted the company to increase exports through the Strait of Hormuz this month and next after halting some shipments via Yanbu.

“Middle East oil flows remain surprisingly strong despite the disruption to Saudi Arabia’s East-West pipeline,” JPMorgan analysts said in a note on 18 September.

“The most notable pivot has come from Saudi Arabia,” the analysts said, adding that satellite data showed Saudi oil moving through the Strait of Hormuz averaged 2.9 million barrels per day over the past six days, up from 700,000 bpd in August.

Meanwhile, the Chairman of Libya’s National Oil Corporation, Massoud Suleman, told Reuters on Monday that production at the country’s Sharara oilfield has seen a partial reduction. He did not give a reason.