DTN Oil Update
Crude Oil Futures Slip, ULSD Rises on U.S.-Iran Diplomacy
HOUSTON, TX (DTN) -- Oil futures closed mixed Friday (9/25) amid renewed hopes for a diplomatic breakthrough between the U.S. and Iran gained momentum, seven months into the conflict.
According to media reports, Iran proposed a seven-day plan to end the war with the United States, which would include the reopening of the Strait of Hormuz and resuming talks on its nuclear plan if the U.S. lifts sanctions on Iranian oil trade, among other conditions.
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U.S.-Iranian negotiations have this week reportedly entered their exploratory phase after a three-month long period of exchanging messages via Pakistani mediators that followed the expiry of a 60-day ceasefire.
The initiative comes as the conflict approaches its seventh month and disruptions in Hormuz continue to affect oil and gas exports and the global economy.
Separately, the White House denied reports that the administration was considering a temporary ban on U.S. diesel exports. Concerns about a potential ban drew criticism from the energy industry, pushed oil prices to a one-week high and fueled a rally in European gasoil futures.
On the supply front, Saudi Aramco said this week that it had restarted its East-West pipeline at reduced flow rates after a two-week shutdown. Ship-tracking data showed that loading operations at the Red Sea port of Yanbu remained suspended. In response to losing its main alternative to the Strait of Hormuz blockade, the country has nearly maximized oil-shuttling operations in the Gulf of Oman.
The ICE Brent futures contract for November delivery fell $1.85 to $104.75 bbl, and NYMEX WTI for November delivery dropped $2.01 to $92.60 bbl.
On a weekly basis, the NYMEX WTI futures contract for November delivery fell 4.07%, while the front-month ICE Brent futures slightly rose 0.36% on a weekly basis.
In contrast, NYMEX ULSD for October delivery rose $0.0704 to $4.8007 gallon, and front-month RBOB futures fell $0.1532 to $3.4114 gallon.
The U.S. dollar index softened by 0.323 points to 101.05 against a basket of foreign currencies.
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