Global oil prices fell on Thursday, October 15, as investors weighed the threat of supply disruptions from escalating tensions in the Middle East against efforts by the United States to ease petroleum shipping costs and increase supply availability.
As at the time of writing 5:15 a.m. (WAT), Brent crude was trading at $104.30 per barrel, down 1.66%, while West Texas Intermediate (WTI) fell 1.11% to $94.03 per barrel.
The decline reversed gains from the previous session, when WTI climbed to a three-week high following attacks by Yemen’s Houthi movement on Saudi Aramco’s headquarters and Iran’s warning that it was adopting new tactics to target vessels passing through the Strait of Hormuz. The developments heightened concerns over the security of energy infrastructure and international oil shipments.
Brent and WTI fell by more than $1 in early trading on Thursday as traders assessed the risks to oil supplies from attacks on shipping through the Strait of Hormuz. The waterway is a critical route for global energy shipments, and further disruption could restrict exports and increase transportation costs.
The market decline came despite fresh reports of attacks on commercial vessels near the strait. Maritime officials said a container ship and a dry bulk carrier sank in separate incidents after being struck by projectiles within 24 hours, while attacks around the waterway have intensified in recent days.
Investors are also monitoring possible changes to US sanctions policy. The administration is considering easing restrictions on certain vessels, including ships associated with the so-called shadow fleet, to allow more petroleum cargoes to move and reduce shipping costs. The proposal could improve the flow of oil into international markets, although its eventual impact will depend on the measures adopted and the volumes transported.
Additional supply from Russia and the Middle East has also helped limit upward pressure on prices. The International Energy Agency reported that Russian crude oil production rose by 65,000 barrels per day in September to 8.43 million barrels per day. Crude exports from Middle Eastern Gulf producers also increased by 4.4 million barrels per day to around 75% of pre-war levels.
However, the supply outlook remains uncertain. Data from the American Petroleum Institute indicated that US crude inventories fell by 11.1 million barrels in the week ended October 9, a larger decline than analysts had expected. Despite the drawdown, prices remained under pressure, suggesting that traders were reluctant to push benchmarks higher amid uncertainty over future supply and shipping conditions. Official inventory figures from the US Energy Information Administration were expected later on Thursday.
For Nigeria, movements in Brent crude remain important to government oil revenue, foreign exchange inflows and the economics of domestic crude supply. However, a decline in international crude prices does not automatically translate into lower petrol, diesel or aviation fuel prices, which are also influenced by refined-product benchmarks, exchange rates, freight, insurance and local distribution costs.
The immediate direction of the market will depend on whether escalating security risks in the Middle East outweigh the prospect of improved supply flows and lower transportation costs. With Brent still above $100 per barrel, Thursday’s decline reflects a shift in market sentiment rather than a clear resolution of the risks threatening global oil supplies.