Oil prices finished mixed on Tuesday as expectations for increased Russian diesel supplies competed with escalating tensions in the Middle East. Continued attacks on Saudi Arabia and Yemen raised concerns about further supply disruptions, while uncertainty surrounding Russian fuel exports limited the market’s response to potential increases in available supplies.

Brent crude futures fell 96 cents, or 0.9%, to settle at $105.69 a barrel, while U.S. West Texas Intermediate (WTI) crude rose 40 cents, or 0.4%, to settle at $94.14 a barrel. Brent’s settlement on Monday had been its highest since September 15, while WTI reached its highest closing price since September 24.

Longer-dated crude contracts continued to climb, with WTI futures for calendar 2027 reaching a record $84 a barrel for the 12th consecutive session. Brent futures for calendar 2027 also reached a record $90 a barrel on Monday, marking a fourth consecutive session of record highs.

Expectations for additional Russian diesel exports remain a focus as governments attempt to address tight fuel supplies and elevated prices. President Trump said the diesel shipments from Russia were intended for international markets rather than the United States. However, uncertainty surrounding the agreement and continued disruptions to global refining capacity have kept diesel prices under pressure, with U.S. diesel futures rising approximately 5% on Tuesday.

Meanwhile, escalating hostilities in the Middle East continue to threaten regional energy infrastructure and shipping routes. Saudi Arabia launched operations in Yemen after Iran-backed Houthi forces intensified their attacks, while recent tanker incidents near the Strait of Hormuz have raised concerns about the security of oil shipments. Approximately 20% of global oil supplies passed through the strait before the war with Iran began in February.

Despite these risks, OPEC+ crude production increased sharply in September, driven in part by higher Saudi Arabian output. Additional production could help offset some supply disruptions, although ongoing attacks and uncertainty over shipping routes remain significant concerns for the global oil market.

OPEC also lowered its forecast for global oil demand growth in 2026 for the sixth consecutive month while raising its outlook for 2027. The organization cited the need to replenish inventories depleted during the conflict with Iran, underscoring the continued strain on global energy supplies.