Oil prices rose on Tuesday, extending gains from the previous session, as a lack of progress in U.S.-Iran diplomacy kept concerns over Middle East supply disruptions in focus despite a recovery in crude exports from the region.

As of 21:23 ET (01:23 GMT), Brent Oil Futures expiring in November rose 1.3% to $106.60 per barrel, while West Texas Intermediate (WTI) crude futures gained 1.1% to $93.60 per barrel.

Brent futures had climbed near $109 per barrel in the previous session but pared gains to settle around $105 a barrel.

Qatari mediators were expected to hold separate talks with Iranian Foreign Minister Abbas Araqchi and U.S. officials, with discussions focused on an amended seven-day proposal put forward by Iran last week, Reuters reported on Monday, citing sources.

The sides remained pessimistic about reaching an agreement before the U.S. midterm elections, the report said.

The diplomatic uncertainty has offset evidence that physical oil flows are recovering.

Crude exports from key Middle Eastern producers rose to 12.8 million barrels per day in September, their highest level since February, according to preliminary Kpler data.

Saudi Arabia and the United Arab Emirates accounted for much of the increase. Saudi crude exports through the Strait of Hormuz were on track to rise sharply this month after Riyadh diverted shipments from the Red Sea port of Yanbu following damage to its East-West pipeline.

Saudi Arabia has now repaired the pipeline and resumed exports from Yanbu, restoring a key route that bypasses Hormuz. The pipeline can transport up to 7 million barrels per day, while about 3.5 million bpd was flowing through it after the restart, the Wall Street Journal reported.

Higher exports have not fully eased the market’s concerns because transporting crude around the Gulf remains costly and difficult.

The disruption has also tightened refined-product markets. Record diesel prices have prompted the White House to consider regulatory changes that could broaden sales of red-dyed diesel, Reuters reported, while speculation over possible U.S. diesel export restrictions has widened the Brent-WTI spread.

Source: Investing.com

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