Crude eased on Thursday morning after a week that pushed prices to fresh highs. Brent fell 1.48 percent to $104.49 a barrel and West Texas Intermediate fell 1.27 percent to $93.88 in the site market tables refreshed at 07:00 ET, with Interfax reporting Brent near $104.3 in early trade. On the week, Brent is roughly flat, up 0.2 percent, while WTI is up 2.61 percent, so the session reads as a pause inside an rising trend rather than a reversal.
The physical backdrop explains why sellers are cautious. Ship-to-ship transfers have squeezed tanker supply, and freight now accounts for close to a third of a cargo’s delivered price, up from less than 5 percent before the war, according to tanker tracking cited by OilPrice.com. Windward counted only two tankers crossing the Strait of Hormuz on October 12, both sailing dark, while UKMTO reported nine attacks in and around the strait in the first seven days of October.
Inventories are the second leg. The American Petroleum Institute estimated on Wednesday that US crude stocks fell 11.12 million barrels in the week ending October 9, a figure filed in yesterday’s edition, and Aramco’s chief executive has warned that global commercial stocks are near the minimum operational level after roughly 3 billion barrels were lost since the war began and about 1 billion barrels were released from reserves. Chevron’s chief executive made the same point in market terms, saying each cycle sets the price floor a little higher.
The diesel market shows the same pattern. President Trump’s announced diesel deal with Russia, at 3 million tons or about 15 million barrels, has failed to bring US diesel below $6 a gallon, because the volume covers only a fraction of consumption. With refinery capacity damaged in the Middle East and Russia and Hormuz flows still impaired, the market is being priced by physical availability rather than by announcements.