Global oil prices dropped to their lowest level in more than a week on Monday as investors assessed hopes for diplomatic progress in the US-Iran conflict, while Saudi Arabia showed signs of recovering oil shipments. Reuters reported that the market was also monitoring continued Houthi attacks in the region.

Brent crude futures fell $2.16, or 2.08%, to $101.71 a barrel, reaching their lowest level since September 10. US West Texas Intermediate (WTI) crude also declined $2.15, or 2.14%, to $98.15 a barrel.

Saudi shipments draw market attention

Investors are closely watching the partial recovery of Saudi oil shipments after disruptions to the country’s East-West pipeline. Saudi Arabia has increased exports through the Strait of Hormuz to help maintain oil flows despite the disruption.

At the same time, attacks by Yemen’s Iran-backed Houthis have kept concerns about regional energy supplies alive. The Houthis have claimed attacks on targets in Riyadh and an Aramco facility in Yanbu, an important Saudi oil export hub.

Markets watch possible diplomatic progress

Investors are also looking toward the United Nations General Assembly, where there are hopes for diplomatic efforts to reduce tensions between the US and Iran.

Tim Waterer, chief market analyst at KCM Trade, said some risk premium had been removed from oil prices because of hopes that a diplomatic path to de-escalate the conflict could emerge this week.

However, continued attacks and uncertainty over regional oil supplies mean market conditions remain sensitive to developments in the Middle East.