Oil falls slightly after Trump says no Iran attack before midterms

Oil prices declined slightly on Friday as the market reduced concerns of an escalation in the Middle East after President Donald Trump announced there would be no new attacks on Iran before the midterm elections. However, the drop in crude was restrained by ongoing disruptions in Middle Eastern supplies, along with anticipation of outages in the U.S. Gulf coast due to Hurricane Isaias, which is expected to hit the region in the days ahead.

West Texas Intermediate crude futures for November dropped by 0.46%, settling at $91.07 a barrel by 19:12 ET (23:12 GMT) on Friday. The price had surged by over 3% earlier in the week on Thursday, but was trading flat for the entire week. In contrast, Brent oil futures for December rose by 3.9% to $104.13 a barrel on Thursday, and gained nearly 2% over the past week.

The slight dip in oil prices came after Trump indicated that Washington would refrain from attacking Iran before the November midterm elections. He also mentioned "productive discussions" with Iran. Iranian media reports suggested the country was considering a response to America's proposal to reopen the Strait of Hormuz, which experienced a surge in attacks on tankers last week, the highest level in any week since the U.S.-Iran war began in February. This led to a sharp increase in crude prices.

The developments triggered a surge in crude, as markets remained concerned about further disruptions in supplies from the Middle East. Clashes between Saudi Arabia and Yemen's Iran-backed Houthis continued to cause worries about more interruptions in the region's oil production. Additionally, oil and gas giants such as BP, Chevron, and Shell evacuated their offshore facilities due to the potential impact of Hurricane Isaias.

The Bureau of Safety and Environmental Enforcement reported that 1.28 million barrels of oil per day, approximately 63% of daily oil production in the Gulf coast, had been halted due to the looming storm. Around 121 platforms were evacuated, with roughly 57% of daily natural gas production also shut down.