TLDR
- Brent crude fell 2.2% to $103.78 a barrel, and US crude dropped 1.4% to $93.75 on Thursday.
- A US official said Washington is weighing eased sanctions on some Russian âshadow fleetâ tankers.
- Two ships sank near the Strait of Hormuz, and Ukraine hit a Russian refinery, limiting the price drop.
- API data showed US crude stocks fell 11.1 million barrels, more than analysts expected.
- Official US inventory data is due at 12 p.m. EDT on Thursday.
Oil prices dropped about 2% on Thursday as the US looked at easing sanctions on some Russian tankers. Ship attacks in the Middle East and Ukrainian strikes on Russian refineries kept the losses in check.
Brent crude futures lost $2.28, or 2.2%, to $103.78 a barrel by 0729 GMT. US West Texas Intermediate futures fell $1.34, or 1.4%, to $93.75.
Both benchmarks gave back gains from Wednesday. West Texas Intermediate had risen 1% to near $95 that day, and Brent settled around $106.
Sanctions Relief on the Table
A US official said on Wednesday that the administration is weighing eased sanctions on some of Russiaâs unregulated âshadow fleetâ tankers. The talks would let âlegal oilâ move on vessels that were sanctioned earlier.
PVM Oil analyst John Evans said such a move could lower freight rates. It could also add flexibility to diesel shipments.
The discussion follows a recent decision by President Donald Trump to temporarily lift sanctions on Russian diesel. That step aimed to ease a global price surge.
Attacks Add Pressure to Supply
Prices found support from the conflict between Saudi Arabia and Yemenâs Houthis. Attacks on ships in the region have also picked up again.
Maritime officials said a container ship and a dry bulk carrier sank near the Strait of Hormuz in the past 24 hours. Projectiles hit both vessels in separate incidents.
Attacks around the waterway have increased over the past 10 days. Iran said it is stepping up strikes in response to the US blockade of its ports and tougher sanctions from last month.
MUFG analysts said the Saudi-Houthi conflict is keeping a geopolitical premium in oil markets. They noted that energy infrastructure has not been hit in recent days.
Ukraine struck a refinery in Russiaâs Ryazan region, resuming attacks on Russian energy sites. Ukrainian President Volodymyr Zelenskiy had voiced anger at a âdangerousâ withdrawal of US intelligence.
Russia also accused Ukraine of attacking two refineries on Wednesday, despite an âenergy ceasefireâ promoted by Trump. Kyiv denied the claim, and Bloomberg could not verify it.
Brent has climbed more than 70% this year as the US-Iran war affects energy markets. The International Energy Agency said global observed inventories sit 509 million barrels below pre-conflict levels.
The agency said on-land stockpiles are near their lowest in at least a decade. It warned that diesel and other fuel supplies will stay under pressure next year.
The American Petroleum Institute reported that US crude stocks fell 11.1 million barrels in the week ended October 9, market sources said. That was a much bigger draw than analysts polled by Reuters expected.
Distillate inventories also fell, while gasoline stocks rose. If confirmed, the crude drop would be the largest since June 2025.
Official US Energy Information Administration data is due at 12 p.m. EDT (1600 GMT) on Thursday. The release was delayed a day by the Columbus Day holiday.
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