Oil prices fell on Monday as expectations of additional Russian diesel supplies and a possible halt to attacks on energy facilities in the Russia-Ukraine conflict eased some concerns over supply. However, continued tensions in the Middle East kept Brent crude above $100 a barrel.Brent crude futures fell $1.54, or 1.47%, to $103.18 a barrel by 7.24 am IST. US West Texas Intermediate (WTI) crude declined by the same amount, or 1.68%, to $90.31 a barrel.ICE gasoil futures, a benchmark for diesel, fell 3% to $1,436 per barrel after US President Donald Trump said Russia would supply additional diesel to US and global markets.Earlier on Friday, Trump said that Russia would immediately supply more than 300,000 metric tonnes of diesel, equivalent to around 2.25 million barrels.He added that another 500,000 tonnes would be supplied in November, followed by a further 1 million tonnes “immediately thereafter”.Global daily diesel consumption is forecast to be close to 29 million barrels, according to the International Energy Agency (IEA).Trump also announced on Sunday that Ukraine and Russia had agreed to halt attacks on each other’s energy facilities. However, Ukrainian President Volodymyr Zelenskyy said he was still waiting for details of the proposed energy ceasefire.The announcements eased some immediate concerns over supply, said Tim Waterer, chief analyst at KCM Trade, Reuters reported.“Questions remain over the validity and longevity of any such ceasefire, and without clearer evidence that it will actually hold, the extent of the pullback is likely to stay limited,” he added.Despite the easing of some supply concerns, the conflict in the Middle East continued to support oil prices. The Houthis claimed responsibility for a Saturday strike on Riyadh’s international airport that reportedly killed 13 people and injured more than 300.Saudi authorities also reported injuries in another attack on the airport on Sunday.Trump said on Saturday that the US was considering joining Saudi strikes against the Houthis. The conflict has spilled over from the wider war involving Iran, launched by the US and Israel in February.Attacks on tankers passing through the Strait of Hormuz have also increased this month, threatening to disrupt the recovery in Middle Eastern crude exports seen in September.Goldman Sachs raised its Brent crude price forecast for December to $90 a barrel from $85, according to a note by analysts led by Daan Struyven.“We maintain our base case that continued adaptation of Mideast supply will eventually reduce crude oil prices, while potential renewed escalation still poses significant net upside risk,” the analysts said, estimating a risk premium of just over $20 a barrel.“We forecast WTI prices, which are unusually low vs Brent because of high US-Europe shipping costs, to average $81 in December 2026 and $73 in 2027,” they added.Oil prices ended the previous week with mixed movements. Brent futures for December delivery rose $2.47, or 2.41%, to $104.72 a barrel, while WTI gained 1% to settle at $91.85 a barrel.With Brent crude trading above $100 a barrel, geopolitical developments are likely to remain a key driver of prices. Progress in US-Iran negotiations could ease pressure, but the risk of renewed attacks, shipping disruptions and prolonged supply constraints is expected to keep volatility elevated.
