Oil Falls More Than $2 to Near $114.50 as Qatar Pushes Mediation With Iran

Brent crude fell $2.21 to $114.51 a barrel early Monday, pulling back from near six-month highs after Qatari mediators traveled to Tehran in a push to ease U.S.-Iran tensions.

U.S. West Texas Intermediate crude dropped $2.23, or 2.16%, to $101.04 a barrel by 7:26 a.m. Saudi time, Reuters reported. Brent was down 1.89%.

The decline followed a jump of nearly $3 on Friday after attacks by Yemen’s Houthi militants on Saudi Arabia stoked fears of supply disruptions. Brent finished last week up 6%, and WTI ended 2.3% higher.

Qatari mediators went to Tehran on Sunday in coordination with the United States, an official briefed on the situation said.

“Concerns over renewed military hostilities in the Middle East, which drove much of last week’s crude rally, have eased this morning, but the reprieve may prove temporary,” said Vandana Hari, founder of Vanda Insights.

Hari said President Trump has not dispelled market expectations that strikes on Iran could follow the Nov. 3 midterm elections. “We therefore expect volatility to remain elevated, with risks still skewed to the upside,” she said.

Saudi Attacks Keep Supply Fears Alive

Attacks continued over the weekend. The Houthis said they struck Riyadh’s main airport and oil facilities on Saturday, and Saudi authorities said Sunday they had intercepted more missiles and drones, CNBC reported.

Saudi Arabia partially resumed operations at the airport on Sunday despite damage from earlier attacks, even as the Houthis threatened further strikes.

Michael Alfaro, chief investment officer at Gallo Partners, told CNBC that geopolitical uncertainty had already added about $20 a barrel to oil prices.

“I think the theme we’re in right now is that uncertainty is off the charts,” Alfaro said. He added that a substantial strike on Saudi Arabia’s East-West pipeline or more refining infrastructure could send prices sharply higher.

“What we would likely see if oil pushed above 120, 130, 140 dollars a barrel for Brent, that is, you’re going to see more demand destruction,” Alfaro said. He warned that damaged refining capacity could become a problem lasting into 2027.

The pullback held into European hours. December Brent futures were down 1.8% at $114.57 and December WTI was 2.2% lower at $100.96, the Wall Street Journal reported.

The Iran war that began Feb. 28 continues to disrupt commercial shipping through the Strait of Hormuz and the Bab el-Mandeb Strait, according to Reuters.

Saudi Aramco will begin storing crude in Singapore in the second half of 2027 to strengthen its Asian supply chain, energy ministers from both countries said Monday, according to CNBC.

In the United States, the Energy Department said Friday it had authorized the release of 400,000 barrels from the Strategic Petroleum Reserve to address a supply disruption at a Louisiana refinery.

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