Global oil prices declined on Monday after rising sharply last week, but remained close to six-month highs as continued attacks on Saudi Arabia heightened concerns about supply disruptions across the Middle East.
Brent crude futures fell by $1.90, or 1.63 per cent, to $114.82 per barrel by 0959 GMT, while US West Texas Intermediate (WTI) crude dropped by $2.08, or two per cent, to $101.19 per barrel.
Despite Monday’s decline, both benchmarks recorded weekly gains. Brent settled nearly $3 higher on Friday, ending the week up six per cent, while WTI gained 2.3 per cent over the same period.
Analysts said the continued threat to oil infrastructure and transportation routes could limit further price declines, even as diplomatic efforts raised hopes of easing tensions between the United States and Iran.
“With the jeopardy doubled by Houthi attacks into Saudi, any Brent price dips back to the lows of last week will find grateful buyers,” PVM Oil Associates analyst John Evans said.
“Corrective processes are notoriously difficult to quantify, but this one has nowhere near reached any sort of levels where bulls might abandon hope,” he added.
Diplomatic efforts to reduce regional tensions continued over the weekend. Qatari mediators travelled to Tehran on Sunday as part of an initiative to de-escalate the conflict in coordination with the United States, according to an official briefed on the situation.
Senior officials from Saudi Arabia, Turkey and Pakistan were also scheduled to meet Iranian leaders in Tehran on Monday. The meeting would mark their first high-level contact since attacks by Iran-backed Houthi forces on Saudi Arabia became a major point of concern in the wider conflict.
However, diplomatic efforts have yet to stop the attacks. The Houthis said over the weekend that they had targeted pumping stations along Saudi Arabia’s East-West crude oil pipeline and Riyadh airport.
Saudi Arabia said on Sunday that it had intercepted additional missiles and drones, highlighting the continuing security risks facing the major oil-producing country.
The wider conflict, which began with the US-Israeli war on Iran on February 28, has disrupted commercial shipping through strategic waterways, including the Strait of Hormuz and the Bab el-Mandeb Strait.
The Strait of Hormuz is a particularly important route for global oil supplies, making any disruption in the area a major concern for energy markets. Attacks on commercial vessels and threats to shipping have increased uncertainty over the movement of crude oil and other energy products.
According to data compiled by the Washington Institute for Near East Policy, October has been the worst month for attacks on commercial shipping in the Strait of Hormuz and surrounding waterways since the organisation began tracking maritime security incidents in 2017.
Meanwhile, Saudi Arabia is taking steps to strengthen the resilience of its regional oil supply chain. Energy ministers from Saudi Arabia and Singapore said state-owned oil giant Saudi Aramco would begin storing crude oil in Singapore in the second half of 2027.
The arrangement is intended to improve the reliability of Aramco’s supplies in the region amid growing concerns over energy transportation and security.
International Energy Agency chief Fatih Birol also warned that the effects of the conflict could continue to weigh on energy markets beyond this year.
Speaking at an industry event in Singapore on Monday, Birol said he did not expect energy markets in 2027 to return to the conditions that existed before the war with Iran.
His comments reinforced concerns that continued instability, shipping disruptions and threats to critical energy infrastructure could keep global oil markets under pressure even if prices experience short-term declines.
