WTI Oil dips below $94.00 amid reports of higher Saudi crude supplies

• WTI Oil dips below $94.00 on Monday and is nearly 8% below last week's highs.
• Reports that exports of Saudi Arabian oil in September have eased concerns about supply disruption.
• The deadlocked Middle East conflict is keeping a risk premium on Crude prices.

Crude prices extend their decline for the fourth consecutive day on Monday, pushing the US benchmark West Texas Intermediate (WTI) Oil to levels just below $94.00 during the European session. Reports that exports from Saudi Arabia increased significantly in September have pushed the price of the WTI Oil barrel nearly 8% below last week's highs despite the uncertain situation in the Middle East.

CNBC, citing a report by JP Morgan, stated on Saturday that Crude flows from Saudi Arabia remain “surprisingly strong” despite the disruption of the East-West pipeline, which has contributed to easing market concerns about supply.

Admiral Brad Cooper, Head of the United States Central Command, affirmed on Sunday that Oil shipments through the Strait of Hormuz reached their highest levels in the last six months over the last two weeks, thanks to US naval protection and the clearance of mines in the waterway.

Uncertainty in the Middle East conflict is keeping Oil from falling further

The situation in the region, however, remains highly uncertain, which is keeping prices from retreating further from the $100 area. The Tehran-backed Houthi militias from Yemen launched a missile and drone attack on the Saudi Arabian capital of Riyadh, while the US and Iran exchanged new threats in a deja vu of a conflict that is about to enter its seventh month in a complete stalemate.

OCBC's analyst Christopher Wong observes that oil prices "could see some renewed support" after fresh attacks on Saudi Arabia over the weekend, even though Saudi authorities said the attacks on Yanbu and several other locations were thwarted, with "no fresh damage to oil infrastructure reported."

These latest developments come with "the East-West pipeline [is] already damaged and Yanbu loadings disrupted," which, according to OCBC, provides "a reminder that disruption risks remain." Against this background, "further downside in Oil may be limited unless Saudi flows normalise and attacks on energy infrastructure subside," says Wong in a note.