Oil prices fall as Saudi Arabia proposes alternative Asian routes

Global crude oil prices dropped on Wednesday (September 16) as concerns over Middle Eastern supply disruptions eased following a Saudi proposal for alternative delivery routes to Asia.

Brent crude fell by 2.92 dollars, or 2.7 per cent, to settle at 105.83 dollars per barrel. West Texas Intermediate (WTI) crude slid 3.40 dollars to trade at 102.43 dollars per barrel.

Saudi Arabia offered to transfer crude oil via ship-to-ship operations near Sohar Port in Oman to serve Asian refiners, according to sources reported by Reuters. The initiative follows attacks on the Saudi East-West Pipeline, which had sparked severe market anxieties over export capacities.

Ship tracking data released on Wednesday showed that only four visible vessels navigated the Strait of Hormuz on Tuesday, down from seven on Monday and well below the 10-day average of 18 ships.

A smaller-than-expected draw on US crude inventories also weighed on prices. The US Energy Information Administration (EIA) reported that crude stocks fell by roughly 6,40,000 barrels last week, far below the forecasted drop of 16.2 lakh barrels, while refined fuel stockpiles rose.

-SA