WTI Falls 1.9% to $99.83 as Regional Diplomacy Advances
Key Facts
The West Texas Intermediate contract fell $1.93, or 1.9%, to $99.83 a barrel at 17:44 GMT on October 27, according to data reported by Reuters via Euronext. At the same time, the Brent futures contract fell $2.09, or 1.8%, to $113.72 a barrel. The decline came as investors tracked regional diplomatic efforts that could ease concerns about supply disruptions. But prices remained elevated because of escalation risks in the Middle East, including threats to oil infrastructure. Reuters said Brent crude topped $117 a barrel in the previous week, its highest level since April.
Iranian officials met delegations from Saudi Arabia, Pakistan and Turkey in Tehran on Monday, October 26, in an effort to avert renewed fighting, according to the Associated Press. Participants agreed to continue talks on regional peace and security, without setting a date or venue for the next meeting. Iranian President Masoud Pezeshkian said his country supported any agreement "that strengthens regional cooperation and settles disputes." He added that cooperation should make greater use of the shared resources and capabilities of Islamic countries. Turkish President Recep Tayyip Erdogan said renewed attacks on Iran would destabilize the region and harm countries not involved in the conflict. The contacts give the market an indication of the path toward de-escalation, but set no specific date for their continuation.
By contrast, the Houthis said on Tuesday they had targeted Saudi Arabia's Ras Tanura refinery with a ballistic missile, Reuters reported. That kept energy facilities at the center of concerns about a widening regional disruption. An analyst at SEB said oil prices included a substantial risk premium for the possibility that the United States or Israel could attack Iran in the coming weeks. The premium reflects the market's sensitivity to the possibility that a confrontation could affect oil flows or shipping security. The effect of diplomatic talks therefore coincided with continued pricing of escalation risks, rather than removing them as prices fell during the session.
On the supply side, Russian oil refineries increased crude processing by 25% in the second half of October compared with the start of the month, after sustained drone attacks on refineries stopped, according to three industry sources cited by Reuters. The increase in processing points to improved Russian refining activity in the second half of the month. In the United States, the Energy Information Administration said average refinery utilization exceeded 95% of capacity between May and September 2026, the highest for those months since 1998. The agency attributed the level to tight global supplies of refined products, particularly diesel. These figures show that the crude market is affected by regional supply risks and refineries' need to meet strong demand for products.
UBS revised its Brent forecast, expecting prices to remain near $110 a barrel through year-end, up from its previous estimate of $100. The firm attributed the higher forecast to volatile Middle East supplies and continued geopolitical uncertainty. The outlook comes as signs of de-escalation intersect with the risk of attacks on energy facilities and the possibility of a wider confrontation. In EL7's daily market data, WTI was recorded at a close of $99.9 a barrel and Brent at $113.88 on October 27. On October 28, the recorded close was $101.35 for WTI and $115.4 for Brent.