Oil prices traded below $98 a barrel on Thursday, October 1, as traders assessed the recovery in crude flows from the Middle East against continued tightness in fuel markets. Brent crude for December delivery was near $98 a barrel after gaining 1.9% in the previous session, while West Texas Intermediate hovered around $90. The market remains focused on whether crude shipments can return sustainably towards pre-war levels and whether fuel supplies can recover at the same pace.
The recent movement in prices follows a three-month rally for crude, with oil recording gains in September as uncertainty surrounding Middle East supplies continued to influence trading. While crude flows from the region have been moving closer to levels seen before the conflict, the recovery in refined fuel supplies has been weaker. The divergence has kept pressure on fuel markets even as concerns over an extended disruption to crude shipments have eased to some extent.
A key issue for traders remains the status of the Strait of Hormuz, a critical route for global energy shipments. Markets are awaiting greater clarity on whether the United States and Iran can reach an agreement that would allow the waterway to fully reopen and support more consistent flows. Any disruption or uncertainty surrounding the strait can have a significant effect on crude and fuel markets because of its role in transporting oil from major producers in the Middle East.
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US President Donald Trump said at the White House that the United States has “total control” of the waterway and indicated that Washington would have an answer for Iran shortly. His comments added to the uncertainty surrounding the future of the shipping route and the broader geopolitical situation. Traders are closely monitoring developments between Washington and Tehran because any agreement could ease supply concerns, while renewed tensions could put pressure on crude prices.
The recovery in crude flows has nevertheless provided some relief to the market. Higher shipments could help replenish inventories and reduce concerns about a prolonged shortage of crude. However, the slower recovery in fuel supplies means refiners, distributors and consumers continue to face tighter conditions. The difference between crude availability and refined-product supply is therefore becoming an important factor in determining the direction of energy prices.
For now, the oil market remains caught between improving crude flows and persistent fuel-market tightness. Brent's retreat below $98 follows its recent gains, while WTI remains around $90 as traders assess geopolitical developments, shipping conditions and supply recovery. The next moves in oil prices are likely to depend heavily on developments involving the Strait of Hormuz and US-Iran discussions, alongside evidence that fuel supplies are beginning to recover more substantially.
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