LONDON: Oil prices fell on Monday amid attacks on Gulf oil production and US President Donald Trump's call for global efforts to secure the Strait of Hormuz.
Brent crude futures were down 92 cents at $102.22 a barrel by 3:48 p.m. Saudi time, while US West Texas Intermediate crude was down $3.45, or 3.5 percent, to $95.26.
Both contracts have surged more than 40 percent this month to their highest since 2022, after the US-Israeli attacks on Iran prompted Tehran to halt shipping through the Strait of Hormuz, a critical waterway for a fifth of global oil and liquefied natural gas supplies.
The UAE’s daily oil output is down by more than half as the Iran conflict and the effective closure of the Strait of Hormuz forced state oil giant ADNOC to implement widespread production shut-ins, two sources told Reuters.
ADNOC has suspended crude loading operations at the United Arab Emirates port of Fujairah, a source familiar with the situation told Reuters on Monday, after a drone attack triggered fires at the key export terminal.
Some loadings resume at Fujairah Port
Some other loading at the hub has resumed, however, two additional sources said, with one saying two of the port's three single-point moorings, at which ships dock, are operational.
Fujairah, outside the Strait of Hormuz, is the outlet for about 1 million barrels per day of the UAE's flagship Murban crude oil, a volume equal to about 1 percent of world demand.
President Donald Trump is speaking with European allies and many other nations about opening the Strait of Hormuz, White House Press Secretary Karoline Leavitt said during an interview with Fox News on Monday.
British Prime Minister Keir Starmer said on Monday Britain would not be drawn into a wider war in Iran but would work with allies on a "viable" plan to reopen the Strait of Hormuz.
US Treasury Secretary Scott Bessent told CNBC on Monday that the Treasury had not intervened in oil markets, and any US action to mitigate higher prices would depend on the duration of the war.
The war in the Middle East is creating the biggest oil supply disruption in history, the International Energy Agency said on Thursday, as major oil producers such as Saudi Arabia, Iraq and the UAE cut production.
PVM analyst Tamas Varga said investors recognised that the consequences of a prolonged conflict would be severe, especially as inventories are steadily depleted, with so much damage already to production, exports and refining from just two weeks of disruption at the Strait of Hormuz.
Further strikes on Khard Island?
Over the weekend, Trump threatened further strikes on Iran's Kharg Island, which handles about 90 percent of its exports, after hitting military targets there and spurring further retaliation from Tehran.
The US is in contact with Iran, Trump said, though he doubted Tehran was prepared for serious talks to end the conflict.
On Sunday, the International Energy Agency said more than 400 million barrels of oil reserves will begin flowing to the market soon, a record draw aimed at combating price spikes caused by the Middle East war.
Stocks from countries in Asia and Oceania will be released immediately, while those from Europe and the Americas will be available at the end of March, the agency said.
"As the conflict enters its third week, the lack of a clear denouement has left global markets increasingly worried about an uncontrollable escalatory spiral," SEB's Meyersson said.
Still, US Energy Secretary Chris Wright said on Sunday he expected an end to the war within "the next few weeks," with oil supplies rebounding and energy costs falling afterwards.
