By Radarr Africa Business Desk
LAGOS, November 2 (Radarr Africa) – Oil prices fell about 3 per cent on Monday on hopes that Qatari-mediated talks could end the US-Israeli war on Iran, though traders remained worried that the conflict could escalate after the US midterm elections, Reuters reported.
Brent crude futures fell US$3.68, or 3.2 per cent, to US$109.75 a barrel by 0407 GMT, while US West Texas Intermediate (WTI) fell US$3.43, or 3.3 per cent, to US$100.69, Reuters said in a report from Singapore by Florence Tan. Brent ended October at its highest level in six months.
The December WTI contract was at US$101.00 on Sunday evening, down 3 per cent, according to Yahoo Finance. Earlier in the month, Brent rose 2.59 per cent to about US$111.60 a barrel on October 22, and dated Brent traded between US$110 and US$114 on October 24, The Rio Times reported, citing Nairametrics.
Iranian and Qatari officials held a third straight day of talks. Iranian Foreign Minister Abbas Araqchi said the talks were “ongoing and progressing” and that Tehran was prepared for “both defence and diplomacy”, according to the report.
Tim Waterer, chief market analyst at KCM Trade, said: “Oil is seeing a technical pullback this morning after last week’s strong gains.” He said lingering hopes of some form of diplomatic progress had eased prices.
Analysts at ING wrote in a client note that the market is “increasingly bracing for the potential for more hostilities between the US and Iran”, Reuters reported. Traders were wary of escalation after the US midterm elections on Tuesday, the agency said.
Attacks on oil tankers in the Strait of Hormuz are raising global energy and shipping costs, Reuters reported. Yahoo Finance said the Strait remains effectively shut in the ninth month of the conflict, and that WTI settled on Friday above US$104 a barrel, its highest close since mid-September.
Supply signals were mixed. Saudi Arabia increased crude exports in October from September despite Houthi attacks on its energy infrastructure, according to two of three ship-tracking companies cited by Reuters, which did not name them. The Organisation of the Petroleum Exporting Countries and its allies, known as OPEC+, kept their December production targets steady, the agency said.
The price of oil matters directly to African economies. In Kenya, Central Bank governor Kamau Thugge has warned that inflation could exceed the upper limit of the bank’s target band if crude rises above US$110 a barrel, Briefs Finance reported. Kenya’s inflation rose to 7.3 per cent in October, according to the Kenya National Bureau of Statistics.
In Nigeria, higher crude prices lift state oil income, but a weaker naira and costly fuel offset part of the gain, The Rio Times reported on October 24. The report said Bonny Light, Nigeria’s flagship grade, last traded near US$115 a barrel on that date, citing Nairametrics. It said lawmakers raised the 2026 budget oil price benchmark to US$75 a barrel from the US$64.85 originally proposed.
The Rio Times also reported that petrol sold for N1,380 to N1,400 a litre at Lagos stations in mid-October, and that the naira closed at N1,365 to the dollar on October 22.
