Brent crude futures fell 94 cents, or 0.9%, to $102.13 a barrel, while West Texas Intermediate (WTI) declined 59 cents, or 0.7%, to $91.56. The move followed a sharp rise in oil prices during the previous session.

A senior Iranian official said Tehran remained open to diplomacy, although Iran and the United States are still divided over how to end the conflict. The comments came after Iranian President Masoud Pezeshkian addressed the United Nations General Assembly.

Diesel export concerns add uncertainty

Investors are also watching reports about a possible US ban on diesel exports. Politico reported that the Trump administration was preparing a 90-day ban, but a White House official later denied the report. US Energy Secretary Chris Wright also said a blanket ban was not being considered.

The debate comes as diesel prices remain high because of disruptions to global fuel supplies. Analysts have warned that restricting US diesel exports could affect international fuel availability.

US crude inventories rise

Meanwhile, US crude inventories increased by 3 million barrels to 426.4 million barrels in the week ended September 18, according to the Energy Information Administration (EIA). Analysts had expected inventories to decline by about 641,000 barrels.

Gasoline stocks fell by 1.7 million barrels, while distillate inventories, including diesel, declined by 400,000 barrels.