Oil prices eased on Wednesday, retracing part of Tuesday’s sharp gains, as Iraq and Kurdish authorities reached an agreement to resume crude exports via Turkey’s Ceyhan port. The development offered modest relief to concerns over Middle East supply disruptions, though broader regional tensions continue to underpin market volatility.
Brent crude futures, which had risen more than 3% on Tuesday, fell 67 cents, or 0.65%, to $102.75 a barrel by 0209 GMT. U.S. West Texas Intermediate (WTI) crude declined $1.18, or 1.23%, settling at $95.03. Despite Wednesday’s pullback, Brent has remained above the $100 per barrel mark for four consecutive sessions, supported by ongoing uncertainty around oil flows from the Middle East.
Iraq’s Oil Minister Hayan Abdel-Ghani told state media that oil shipments through Ceyhan were expected to restart at 0700 GMT on Wednesday. According to officials, Baghdad aims to pump at least 100,000 barrels per day (bpd) through the Turkish port.
“While it all helps and buys some time, 100,000 bpd is not a huge game-changer as Iraq has still lost about two million barrels per day,” said Tony Sycamore, an analyst at IG Markets.
Production from Iraq’s southern oilfields—the country’s primary crude-producing region—has plunged roughly 70% to 1.3 million bpd as the ongoing Iran conflict has effectively blocked exports through the Strait of Hormuz, a key maritime chokepoint handling around 20% of global oil shipments.
Tensions escalated further on Tuesday when Iran confirmed that its security chief, Ali Larijani, had been killed in an Israeli strike—the most senior Iranian figure targeted since the start of the U.S.-Israeli military actions. Senior Iranian officials indicated that the country’s new supreme leader has rejected offers for de-escalation presented by intermediary nations.
The U.S. military also said it conducted strikes along Iran’s coastline near the Strait of Hormuz, citing threats from Iranian anti-ship missiles to international shipping. While Larijani’s death and U.S. strikes have raised hopes among some analysts that the conflict might reach a resolution sooner, the outlook for regional stability remains uncertain, noted Mingyu Gao, chief researcher for energy and chemicals at China Futures.
Meanwhile, U.S. crude inventories rose by 6.56 million barrels in the week ending March 13, according to American Petroleum Institute (API) data reported Tuesday. A Reuters poll had forecast a more modest increase of around 380,000 barrels.
Overall, the oil market is caught between a partial resumption of Iraqi exports and persistent geopolitical risks in the Middle East, keeping prices elevated and volatility high.