Oil prices moved lower in Asian trading on Thursday after three straight sessions of gains.
The pullback came after U.S. President Donald Trump said the latest military campaign against Iran was unlikely to last long. U.S. officials also pointed to signs that energy flows through the Strait of Hormuz were improving.
At 02:31 ET, Brent crude futures for November fell 1.5% to $94.22 per barrel. West Texas Intermediate crude futures dropped 1.4% to $89.78 per barrel.
Oil Prices Retreat After Three-Day Rally
Both Brent and WTI had risen sharply over the previous three trading sessions, reaching their highest levels in five weeks.
The rally was driven by concerns that renewed military clashes between the United States and Iran could further disrupt oil supplies from the Middle East.
U.S. forces struck Iran’s southern coast on Wednesday, while Tehran retaliated against American positions across the region.
The exchange marked the most intense fighting between the two countries since July.
Trump Signals Iran Campaign May Be Brief
Trump said on Wednesday that the renewed U.S. military campaign against Iran was not expected to continue for an extended period.
His comments helped ease some of the market’s immediate concerns about prolonged supply disruptions.
Trump also said the United States had targeted Iranian radar systems, missile capabilities and equipment linked to mine-laying around the Strait of Hormuz.
Strait of Hormuz Remains Key for Oil Markets
The Strait of Hormuz continues to be one of the main risks for global oil markets.
U.S. Energy Secretary Chris Wright said around 17 million barrels of crude passed through the waterway on Monday.
That was the highest reported volume since the conflict sharply reduced shipping activity.
However, traffic through the strait remains volatile.
Preliminary data from Kpler showed that only four commodity vessels passed through the waterway on Tuesday. That compared with a 10-day average of around 13 vessels.
U.S. Crude Inventories Fall
The oil market also received support from lower U.S. crude inventories.
Commercial crude stocks fell by 4.5 million barrels last week, marking the first weekly decline in five weeks.
The drop also surprised analysts, who had expected a small increase in inventories.
Gasoline Stocks Decline as Distillates Rise
Fuel inventory data was mixed.
Gasoline stocks fell by 1.2 million barrels.
However, distillate inventories, including diesel and heating oil, increased by around 800,000 barrels.
These figures provided a mixed signal for domestic energy demand.
OPEC+ Output Policy in Focus
Attention is also shifting toward the upcoming OPEC+ meeting.
The group is expected to keep its October oil production policy unchanged when members meet on Sunday.
OPEC+ has already completed the planned unwinding of a 1.65 million-barrel-per-day layer of production cuts.
The group previously raised September output quotas by 188,000 barrels per day.
Oil Market Watches Iran and OPEC+
Oil prices remain highly sensitive to developments in the Middle East, especially around the Strait of Hormuz.
While Trump’s comments helped reduce some fears of a prolonged conflict, shipping disruptions and geopolitical risks remain important factors for crude prices.
Investors will now focus on OPEC+ policy, U.S. inventory data and further developments between the United States and Iran.
