WTI crude oil sharply reversed late on October 9 after rising to $91.40 per barrel. The price fell to approximately $89.95, then stabilized around $90.50. The reason was the announcement of new supplies of Russian diesel and a temporary US authorization for transactions with Russian diesel fuel.
What was announced
After a conversation with Vladimir Putin, Donald Trump stated that Russia is ready to immediately supply more than 300 thousand tons of diesel fuel to the American and global markets. Another 500 thousand tons are declared for November, followed by an expected additional supply of 1 million tons. The first batch of 300 thousand tons corresponds to approximately 2.2 million barrels. For the market, this is a significant additional volume specifically in the refined products segment, where the strongest tension has persisted in recent weeks.
What changed regarding sanctions
On October 9, the US Treasury issued General License 135. The document temporarily authorizes transactions related to supplies of Russian diesel fuel. The authorization is valid until April 7, 2027. This is a special authorization for certain transactions, not a cancellation of the entire complex of sanctions against Russia.
How WTI reacted
Before the news, WTI had risen to approximately $91.40. After the announcement, the price quickly dropped below $90, giving back a significant portion of the daily gain. Later, quotes recovered to approximately $90.50. The session range was approximately between $89.50 and $91.50.
Why diesel is so important
The main tension now is observed not so much in crude oil as in the market for finished diesel fuel. Diesel futures were around $4.67 per gallon, which corresponds to approximately $196 per barrel. With WTI around $90, the difference exceeds $100 per barrel. Therefore, additional diesel supply is capable of noticeably influencing the refined products market and demand from refiners.
What is happening with Russian supplies
Russia plans to increase diesel exports as repairs at refineries are completed. Additional volumes may come to market in November and December. For traders, what now matters is not only the statement itself, but also how quickly the declared volumes actually reach buyers.
Why oil declined
Additional diesel supply is capable of reducing the deficit in the refined products market. If tension in the diesel segment eases, pressure on finished fuel prices decreases. This is also reflected in crude oil, since the market begins to price in a less tight supply balance. That is precisely why the news quickly hit WTI.
What's next
The next key question is how quickly the declared volumes actually reach the market. Actual supplies in November and subsequent months are also important. If additional diesel noticeably increases supply, pressure on refined products may persist. For WTI, the $90 zone is again becoming an important short-term reference point.
Oil moved $1.45 in an evening - did you capture it?
Political and energy headlines are capable of sharply changing the direction of oil futures within minutes. When trading through a prop firm, the available notional and the rules of the specific program are especially important here. In prop trading, a trader passes an evaluation and gains access to the company's trading account without needing to use comparable personal capital. Such conditions are better studied in advance, before the next sharp move in the oil market.