Oil prices slipped below the $100-a-barrel mark on Wednesday as Saudi Arabia began restoring crude supplies through a key pipeline to the Red Sea, while hopes of a diplomatic breakthrough in the US-Iran war added to the ease.WTI crude was trading at $90.10 a barrel, down 42 cents, or 0.46%, while Brent crude stood at $99.09, down 16 cents, or 0.16% around 7:30 am IST.The decline came after Brent closed below $100 a barrel on Tuesday for the first time since September 8. Expectations of improving oil supplies, along with efforts to find a diplomatic solution to the nearly seven-month conflict, put pressure on benchmark crude prices.US President Donald Trump has warned that he could “annihilate” Iran, but also said his envoys Steve Witkoff and Jared Kushner had held productive talks with Iranian mediators aimed at ending the war.“I think there’s a lot of momentum for them to make a deal,” Trump said.Meanwhile, Saudi Arabia has restarted operations on its East-West Pipeline to the Red Sea, according to three sources briefed on the matter. The move has been accompanied by signs of an increase in Middle Eastern oil flows.The pipeline had been shut on September 11 after drone attacks, which Saudi Arabia blamed on an Iraqi militia, halted crude loadings at the kingdom’s Yanbu port.Since the US-Israeli war on Iran disrupted oil flows from Saudi Arabia and other Gulf producers through the Strait of Hormuz, Riyadh has been using the pipeline to reroute around 4 million barrels of crude per day to Yanbu. That volume is equivalent to around 4% of global oil supply.Iraq is also increasing its oil exports. Oil minister Basim Mohammed said on Tuesday that the country was exporting more than 3 million barrels per day and expected exports through Turkey to rise to more than 600,000 bpd.Provisional figures from shiptracking firms Vortexa and Kpler put Iraq’s crude exports in August at 2.3 million bpd and 2.17 million bpd, respectively. Both estimates were higher than July levels but remained below the February pre-war levels of 3.7 million bpd and 3.362 million bpd, respectively.Adding to the pressure on oil prices, industry data showed US crude inventories increased by 1.8 million barrels in the week to September 18. Analysts polled by Reuters had expected inventories to decline.As the conflict continues for over 6 months now, oil markets have continued to remain volatile as global supply chains continue to face disruption.
