DTN Oil Update
Oil Below $100 Bbl as U.S.-Iran Diplomacy Awaited at U.N.
SECAUCUS, NJ (DTN) -- Crude futures fell for a fifth straight session Tuesday (9/22) as energy markets awaited hints at diplomacy from U.N. general assembly speeches by U.S. President Donald Trump and his Iranian counterpart Masoud Pezeshkian that could signal a reopening of the Strait of Hormuz to oil and other energy shipments.
The front-month contracts for both WTI and Brent crude both remained beneath $100 bbl after a senior Iranian official was quoted telling media that the U.N. podium in New York would present a "golden opportunity" for the U.S. to lift its naval blockade on Iranian cargoes and for Tehran to reciprocate by reopening the Hormuz.
Trump has told a news channel that he would "probably" be open to a sit-down with Pezeshkian.
Neither the White House nor the Iranian authorities have confirmed any face-to-face talks between the two presidents. Both leaders will address the assembly this week, Trump scheduled to go on Tuesday after U.N. Secretary-General Antonio Guterres and Pezeshkian on Wednesday (9/23). It will be the first event featuring the two leaders since the earnest start of the U.S.-Iran war in March, and Pezeshkian's first appearance on U.S. soil amid the seven-month-long conflict.
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By 9:26 a.m. ET, NYMEX WTI crude for October delivery fell $2.44, or 2.57%, to $93.34 bbl. The session high was $97.42.
ICE Brent for November delivery moved down $2.00, or 1.97%, to $98.34 bbl. It reached as high as $102.30 earlier in the day.
Downstream, NYMEX ULSD for October delivery eased $0.0989, or 2.14%, to $4.7906 gallon. It peaked at $4.9571 during the session.
RBOB for October advanced $0.0140, or 0.59%, to $3.4839 gallon. The high for the day was $3.5040.
The U.S. dollar index gained 0.014 points to 100.170 against a basket of currencies.
Crude futures have lost about $10 bbl since the close of September 15 despite preliminary tanker tracking services on the Hormuz reporting the passage of only two commodity-carrying vessels on Monday (9/21) compared with 10 at the weekend.
Despite the market's focus on a potential breakthrough in the conflict, Bank of America
raised its second-half Brent crude forecast, warning of a spike toward $150 bbl if geopolitical tensions worsened and physical supply bottlenecks persisted. BofA noted that while diplomatic overtures offered temporary headline relief, spare production capacity across key producers remained exceptionally constrained following months of infrastructure damage and regional transport diversions.
Structural risks to global energy flows remain active on multiple fronts. In the southern Red Sea corridor, ongoing clashes between Houthi forces and Saudi-backed units in Yemen continue to threaten the Bab el-Mandeb Strait, a vital maritime bypass Saudi Arabia relies upon to route crude into global channels.
In North Africa, output from Libya's 340,000 bpd Sharara field dropped to approximately 127,000 bpd after an armed faction blockaded a pipeline connecting the asset to the Zawiya export terminal.
Meanwhile, middle distillate markets remain structurally tight as Russia contemplates extending its producer-level diesel export ban into October. Continuous Ukrainian drone strikes on domestic refineries have crimped Russian processing capacity, helping drive diesel and heating oil prices to multi-year highs across Western markets.
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