WASHINGTON (dpa-AFX) - Partially offsetting Friday's pullback, crude oil prices have soared on Monday after Saudi Arabia confirmed closing its East-West pipeline following attacks by Houthi militants.
Further, the postponement of the scheduled talks between the Gulf Cooperation Council members and Iran diminished expectations of the reopening of the Strait of Hormuz.
WTI Crude Oil for October delivery was last seen trading up by $1.52 (or 1.52%) at $101.57 per barrel.
Last Friday, Saudi Arabia's Energy Ministry confirmed shutting down its East-West Pipeline following recent attacks by the Iran-backed Houthi militant group of Yemen.
Firing drones from Iraq, the Houthis targeted and attacked the pipeline in the Riyadh and Medina regions on September 10.
The nearly 750-mile (or 1,200 km) long channel serves as an artery for Saudi Arabian crude oil exports to reach global markets without touching the Strait of Hormuz, which has been shut by Iran since the start of the U.S.-Iran war. It stretches from Saudi Arabia to the port of Yanbu in the Red Sea and can carry up to 7 million barrels per day.
Experts are of the view that full repairs could take anywhere from six to eight weeks under favorable conditions. A prolonged outage could compel Saudi Arabia to slash production.
Last Friday, the member-nations of the Gulf Cooperation Council also agreed to meet a high-level Iranian team to discuss the U.S.-Iran conflict. The meeting was slated to be held at the port city of Salalah in Oman today.
Last night, without announcing a new date, the region's officials announced that the meeting had been postponed.
Iran's Foreign Ministry Spokesperson Esmaeil Baghaei stated that Saudi Arabia requested for the postponement in view of the developments unfolding in Yemen.
Yesterday, citing Qeshm Governor Amir Teymouri, Iranian state broadcaster announced that an Iranian commercial vessel was struck by U.S. forces near Qeshm Island in southern Iran.
Iran's Islamic Revolutionary Guards Corps stated that its new advanced aerospace defense system intercepted and destroyed a sophisticated drone (MQ-1) over the Strait of Hormuz.
Reuters reported citing data from Kpler from Monday, over the weekend, four vessels exited the gulf through the Strait of Hormuz while 10 vessels entered the gulf.
The data showed that through the Bab al-Mandeb Strait, 24 vessels traveled on Saturday and 27 vessels transited on Sunday.
Last Thursday, U.S. President Donald Trump remarked that the U.S.-Iran war will end after the midterm U.S. elections in November and asserted that crude oil prices would tumble after that.
Yesterday, in Ireland, Trump reiterated that the war would end this year and repeated that gasoline prices would then drop like a rock.
Claiming that Iran has called constantly to restart talks with the U.S., Trump stressed that the U.S. would not agree to any deal that is not beneficial to the U.S.
Drawing a comparison to last year's U.S. military coup in Venezuela, Trump suggested that U.S. forces may stay in Iran and keep the oil.
Trump also announced that Russia and Ukraine agreed to stop attacking each other's energy installations, reviving hopes for a de-escalation in the war ongoing for more than four years. However, neither Russia nor Ukraine confirmed Trump's claims.
Ahead of the upcoming two-day meeting of the U.S. Federal Reserve which begins tomorrow, market expectations for a rate hike by the Fed have increased following last Friday's core inflation data that came in above the Fed's target.
Currently, the bets for a rate hike stand at around 92.70%, according to the CME Group's FedWatch Tool, as against the 60% last week.
Experts are of the view that while a rate hike may not be definitive, any rate lowering in the near-term now appears to be out of question.
The U.S. dollar index was last seen trading at 99.41, up by 0.29 (or 0.29%) today.
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