WTI crude dives ~4% to ~$89.38, lowest September settlement, as Gulf supply recovers
What happened
West Texas Intermediate crude futures dived nearly 4% on Tuesday to settle around $89.38 a barrel, the lowest settlement of September, according to Investor's Business Daily's post-close market wrap. The selloff was driven by concrete signs of improving Gulf supply: Saudi Arabia restarted its East-West oil pipeline (first flows since the September 10 drone attacks) and resumed Red Sea oil exports, while tanker movement was seen on the Strait of Hormuz. WSJ reported that Gulf exports reached 80% of prewar levels in September (Kpler), with Brent falling about 1.9% to ~$103.24 and WTI down about 2% in European trading before extending losses into the U.S. settle.
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Who’s affected
- Energy sector (XLE) — fell with crude; majors like Exxon/Chevron had been outperforming on elevated prices, so the sharp pullback reverses that tailwind
- Refiners/transportation/consumers — lower fuel costs ease input costs and support margins; retail gasoline has been running ~$4.46-$4.48/gal per AAA
- Broad market / rates — falling oil eases the inflation pressure that has been pushing the Fed toward more hikes (10-yr at 19-yr highs); a meaningful disinflationary impulse if it holds
Sources