Oil Prices Tumble as Traders Price In a Strait of Hormuz Breakthrough
India's Crude Oil Output Falls for Third Straight Year September WTI crude oil futures are trading at $78.08 early Friday, down $8.72, or 10.05%, for the week.
The market opened at $80.10, traded as high as $82.33, and fell to $74.24.
With Friday’s session still ahead, the weekly result is not final.
But the message from the price action is clear.
Traders sold the possibility that diplomacy could restore crude flows through the Strait of Hormuz, then bought back part of the break when it became clear that the shipping problem had not been solved.
The early selloff was driven by optimism surrounding talks involving Iran, Oman and the United States.
The market treated reports of progress as a path toward reopening Hormuz and releasing more Gulf crude into the global market.
That was enough to pull a large amount of risk premium out of WTI in a short period.
The problem is that the market priced the result before it had the barrels.
Iran wants influence over ships entering the Gulf and visibility over vessels leaving it.
That may create a temporary arrangement, but it does not restore unrestricted shipping or give refiners confidence that cargoes will move on schedule.
WTI bounced from the weekly low, but the rebound did not erase the break.
| Product | Price | Change |
|---|---|---|
| Brent Crude | $102.14/bbl | +0.34% |
| WTI Crude | $96.90/bbl | +0.21% |
| EN590 Diesel | $846/MT | +0.18% |
| Jet Fuel A-1 | $1090/MT | +0.55% |
| Mazut M100 | $450/MT | -0.15% |
| Bitumen 60/70 | $470/MT | +0.08% |
| Sulphur Gran 99.5% | $470/MT | -0.44% |
| Urea 46% Gran | $650/MT | +1.12% |
| NPK 16-16-16 | $460/MT | -0.28% |
| Nat Gas TTF | $15.42/MMBtu | +0.92% |
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