Oil Falls to Two-Week Low as Gulf Supply Risks Ease
Oil prices retreated on Thursday after a sharp rebound in the previous session, as renewed signals from Iran that it remains open to diplomacy and improving Gulf crude flows continued to shape expectations for global energy supplies.
Brent crude was down about 0.23% at $102.80 a barrel in Asian trading on Thursday, while U.S. West Texas Intermediate (WTI) was down 0.15% at $92.02, according to market data reported Thursday.
The latest move follows a volatile session on Wednesday, when Brent settled 3.86% higher at $103.08 a barrel and WTI gained 1.81% to $92.16 as markets reacted to renewed tensions between Washington and Tehran.
Despite the rebound, oil remains well below the levels reached earlier in September, when disruptions to Gulf supply routes pushed Brent above $100 and heightened concerns about the Strait of Hormuz.
Oil Market Snapshot
| Benchmark | Thursday price* | Thursday move | Wednesday close |
|---|---|---|---|
| Brent crude | $102.80/barrel | -0.23% | $103.08 |
| WTI crude | $92.02/barrel | -0.15% | $92.16 |
*Asian trading levels reported on September 24, 2026.
Saudi Supply Routes Begin to Recover
A major factor behind the recent easing in supply concerns has been the restart of Saudi Arabia’s East-West oil pipeline.
Saudi Arabia resumed operations on the pipeline after it was shut following drone attacks earlier this month. The route connects the country’s eastern oil fields with the Red Sea port of Yanbu, allowing crude to reach international markets without passing through the Strait of Hormuz.
The pipeline has a maximum capacity of about 7 million barrels per day, although operations have initially resumed at a reduced rate. Reuters reported that restoring full capacity could take several weeks because three pumping stations were damaged.
Saudi Arabia has also increased crude shipments through the Strait of Hormuz. Reuters reported that Saudi oil moving through the waterway had risen to around 2.9 million barrels per day, compared with roughly 700,000 barrels per day in August.
These developments have helped reduce some of the immediate fears of a prolonged global supply shortage.
Iran Diplomacy Remains a Key Market Driver
The other major influence on oil prices is the possibility of renewed diplomacy between Iran and the United States.
On Thursday, Iran said it remained open to diplomatic efforts to end the war, although Reuters reported that the two sides remain far apart on how to resolve the conflict.
Any agreement that allows more normal shipping through the Strait of Hormuz could materially improve the global supply outlook. Before the conflict, roughly one-fifth of global oil and liquefied natural gas supplies moved through the strategic waterway.
However, traffic has not returned to normal. Saudi producers and other Gulf exporters have increasingly relied on alternative shipping arrangements, including ship-to-ship transfers near Oman, to keep crude moving despite the disruption.
What It Means for Ethiopia
For Ethiopia, international oil prices remain important because the country relies on imported petroleum products and therefore requires foreign currency to finance fuel purchases.
A sustained reduction in global crude prices could eventually lower the foreign-exchange cost of petroleum imports. However, crude prices do not translate directly into domestic pump prices, as refined-product prices, freight, insurance, exchange rates and other import costs also influence the final cost.
The latest market movement therefore reflects a combination of improving Gulf supply routes and continued geopolitical uncertainty, rather than a complete normalization of global energy markets.
For now, traders remain focused on the restoration of Saudi export capacity, traffic through the Strait of Hormuz, and whether U.S.-Iran diplomatic efforts can produce a durable reduction in supply risks.