Oil prices extended their declines for a sixth consecutive session on Wednesday as signs of progress in U.S.-Iran discussions reduced some of the geopolitical risk premium in crude markets. Brent crude futures fell to $97.85 a barrel, while WTI crude declined to $89.14 a barrel at 03:30 UTC+8 on 23 September
Brent Crude
WTI Crude
Diplomatic Signals Weigh On Oil
U.S. President Donald Trump said U.S. officials had held a three-hour meeting with Iranian representatives in New York that he described as productive. The meeting marked the first known direct contact between U.S. and Iranian officials since June and raised expectations that diplomatic efforts could eventually reduce disruption to regional oil supplies.
The developments came as Iran reportedly indicated it could reopen the Strait of Hormuz if Washington eases military pressure and lifts its blockade of Iranian ports. Tehran has not confirmed a firm agreement, leaving the status of the waterway uncertain.
Crude Extends Its Decline
| Oil Market | Latest Reaction | Key Data | Main Driver |
| Brent Crude | Extended its decline for a sixth consecutive session | Hit a low of $97.85/bbl at 03:30 UTC+8 on 23 Sep | Progress in U.S.-Iran discussions reduced some geopolitical risk premium in crude markets, while expectations of improved supply conditions weighed on prices |
| WTI Crude | Extended its decline for a sixth consecutive session | Hit a low of $89.14/bbl at 03:30 UTC+8 on 23 Sep | Lower supply disruption concerns and improving expectations around Middle East crude flows pressured prices |
The decline reflects a shift in the balance between geopolitical supply risks and expectations for restored crude flows. Brent had already settled below $100 on Tuesday for the first time since Sept. 8.
Supply Outlook Improves, But Risks Remain
The Strait of Hormuz remains central to the oil market because it handled roughly one-fifth of global oil and liquefied natural gas supplies before the conflict. Recent tanker movements indicate that flows have increased, although shipping risks remain elevated.
Saudi Arabia has also restarted operations at its East-West pipeline, which provides an alternative route to the Red Sea port of Yanbu and can bypass the Strait of Hormuz. The pipeline has a capacity of about 7 million barrels per day, although repairs to damaged pumping stations could take six to eight weeks before full capacity is restored.
What The Oil Market Is Pricing In
The recent decline suggests that part of the supply-risk premium built into crude prices is being reassessed as diplomatic channels reopen and regional flows improve. Reuters reported that Saudi crude shipments through the Strait of Hormuz had also increased, supporting expectations of improved availability.
However, the improvement in flows does not eliminate the underlying supply risks. The Strait remains vulnerable to further disruption, while the timeline for any U.S.-Iran agreement remains uncertain. That leaves oil prices sensitive to both diplomatic developments and actual changes in physical supply.
What Oil Traders Should Watch
Oil traders will focus on whether U.S.-Iran discussions develop into concrete measures that can reduce restrictions on Iranian exports and improve shipping conditions through the Strait of Hormuz.
Attention will also remain on Saudi Arabia’s progress in restoring its East-West pipeline and the volume of crude moving through the Strait. Any sustained improvement in physical supply could further alter the risk premium embedded in crude prices, while renewed disruption would keep supply concerns at the centre of the market.
